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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Serie: Essential Texts for Nonprofit and Public Leadership and Management
- Sprache: Englisch
Since the first edition was published in 1997, Human Resources Management for Public and Nonprofit Organizations has become the go-to reference for public and nonprofit human resources professionals. Now in its fourth edition, the text has been significantly revised and updated to include information that reflects changes in the field due to the economic crisis, changes in federal employment laws, how shifting demographics affect human resources management, the increased use of technology in human resources management practices, how social media has become embedded in the workplace, and new approaches to HRM policy and practice. Written by Joan E. Pynes--a noted expert in public administration--this authoritative work shows how strategic human resources management is essential for managing change in an increasingly complex environment. The book * Includes new material on workplace violence and employee discipline * Reviews updates on the legal environment of HRM * Contains suggestions for managing a diverse workforce * Offers a wealth of revised tables and exhibits * Updates the most recent developments in collective bargaining in the public and nonprofit sectors * Outlines the most current approaches to recruitment and selection * Presents an overview of recent information on compensation and benefits * Gives an update of the technological advances used for strategic human resources management * Provides examples of HRM policies from other countries The book also includes an enhanced instructor's guide with examination questions, PowerPoint® slides, experiential exercises, and video vignettes that are coordinated with chapters in the book.
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CONTENTS
List of Figure, Tables, and Exhibits
Exercises
Preface
Acknowledgments
The Author
Part One: Human Resources Management in Context
Chapter One: Introduction to Human Resources Management in the Public and Nonprofit Sectors
The Public Sector
The Nonprofit Sector
The New Public Service
Today’s Context for Human Resources Management
Conclusion
Chapter Two: Strategic Human Resources Management and Planning
The Changing Role of Human Resources Management
Human Resources Outsourcing
Strategic Human Resources Management and Human Resources Planning
Human Resources Planning
Human Resources Information Systems and Electronic Human Resources Management
Implementing Strategic Human Resources Management
Evaluating the Effectiveness of Strategic Human Resources Management
Problems and Implications of Strategic Human Resources Management
Ethical Standards for Strategic Human Resources Management
Conclusion
Chapter Three: Federal Equal Employment Opportunity Laws and Other Employee Protections
Federal Equal Employment Opportunity Laws
Proving Employment Discrimination
Executive Orders, Affirmative Action, and Other Federal Laws
Affirmative Action
Constitutional Rights
Additional Protections for Employees
Conclusion
Chapter Four: Managing a Diverse Workforce
Glass Ceilings, Sticky Floors, Glass Walls, and Glass Escalators
Why Diversity Is Important
Cultural Competency
Sexual Harassment
Employer Liability
Sexual Orientation
Changes in the Nonprofit Landscape
The Difference between Complying with Laws and Managing Diversity
Strategic Human Resources Management Implications for Managing Diversity
Conclusion
Part Two: Methods and Functions of strategic Human Resources Management
Chapter Five: Job Analysis
Legal Significance of Job Analysis Data
Job Analysis Information and Methods
Designing a Job Analysis Program
Job Description and Job Specification
Strategic Job Analysis
Competency Modeling
Job Analysis Techniques
Contextual Performance
Conclusion
Chapter Six: Recruitment and Selection
Recruitment
Recruiting for Local Governments and Nonprofits
Screening Applicants
Executive and Managerial Recruitment and Selection
Conclusion
Chapter Seven: Compensation
Equity
Executive Compensation and Benefits
Federal Laws Governing Compensation
State and Local Government Minimum Wages
Conclusion
Chapter Eight: Benefits
Required Benefits
Discretionary Benefits
Quality-of Work and Quality-of Life Issues
Conclusion
Chapter Nine: Training and Career Development
The Training Process
Career Development
Managerial and Executive Development
Conclusion
Chapter Ten: Performance Management
Motivation
Developing an Evaluation Program
Rater Training
Who Should Rate?
Executive Evaluation
Documentation
Performance Evaluation Interview
Ethical Issues in Performance Appraisal
Performance Appraisal Techniques
Team-Based Performance Techniques
Conclusion
Chapter Eleven: Labor-Management Relations: Collective Bargaining in the Public and Nonprofit Sectors
The History of Private Sector Collective Bargaining
Collective Bargaining in Nonprofit Organizations
Collective Bargaining in the Federal Government
Collective Bargaining in State and Local Governments
Concepts and Practices of Collective Bargaining
Public Sector Distinctions
Nonprofit Sector Distinctions
Privatization of Public Services
Conclusion
Chapter Twelve: Volunteers
Use of Volunteers
Volunteer Motivation
Barriers to Volunteer Recruitment
Recruitment
The Prerecruitment Process
Managing Volunteers
Orientation and Training
Volunteer Recognition
Evaluation
The Volunteer Protection Act
Governing Boards
Conclusion
Chapter Thirteen: Conclusion: Challenges for Public and Nonprofit Organizations
What to Expect
Challenges for Strategic Human Resources Management
Change in Skill Requirements
References
Name Index
Subject Index
Essential Texts for Public and Nonprofit Leadership and Management
Cover design: Jeff Puda
Cover image: © Photo ephemera/Getty
Copyright © 2013 by John Wiley & Sons, Inc. All rights reserved.
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Library of Congress Cataloging-in-Publication Data
Pynes, Joan.
Human resources management for public and nonprofit organizations : a strategic approach / Joan E. Pynes.—4th edition.
pages cm
Includes bibliographical references and index.
ISBN 978-1-118-39862-3 (pbk); ISBN 978-1-118-46032-0 (ePDF); ISBN 978-1-118-46034-4 (ePub)
1. Nonprofit organizations—United States—Personnel management. 2. Public administration—United States—Personnel management. I. Title.
HF5549.2.U5P96 2013
658.3—dc23
2013010994
FOURTH EDITION
In memory of my mother
LIST OF FIGURE, TABLES, AND EXHIBITS
Figure
2.1
Uses of Human Resources Information Systems
Tables
1.1
IRS Organization Reference Chart
1.2
Number of Nonprofit Organizations in the United States, 1999–2009
1.3
National Taxonomy of Exempt Entities: Broad Categories
3.1
Federal Statutes Related to Equal Employment Opportunity
3.2
International Comparison of Antidiscrimination Criteria Covered by Law
5.1
Department of Labor Worker Functions
7.1
General Schedule Pay Scale, 2012 Annual Rates by Grade and Step
7.2
City-County Library District Salary and Wage Schedule
7.3
Comparable Municipal Market Study for Annual Salaries for Select Local Government Positions
7.4
International Comparison of Working Hours
7.5
Minimum Wage International Comparison
8.1
International Comparison of Benefits
8.2
International Comparison of Parental Leave
11.1
International Comparison of Unions and Collective Bargaining Rights
12.1
Grid for Matching Current and Potential Board Members
Exhibits
5.1
Job Analysis Questionnaire
5.2
Structured Task Checklist
5.3
Examples of Job Descriptions
5.4
Competencies for Supervisory and Leadership Position
5.5
Foreign Service Officer Competencies
6.1
Resources for Job Seekers
7.1
Typical Compensable Factors
10.1
The Many Purposes of Appraisal
10.2
Common Rating Errors
10.3
Trait Rating Scale
10.4
Behaviorally Anchored Rating Scale
10.5
Management by Objectives Rating Scale
10.6
Sample Critical Incidents Report
10.7
Questions to Consider When Developing a Performance Evaluation System
11.1
National Labor Relations Board Jurisdictional Standards in Effect July 1990
12.1
Volunteer Application for Natural Resources Agencies
EXERCISES
1.1
Art Museums Are Looking for Leaders
2.1
State and Local Government Workforce: 2012 Trends
2.2
Some Nonprofits Are Hiring
3.1
A Muslim Woman’s Right to Wear a Head Scarf at Work
3.2
States Are Taking the Lead on Family Discrimination Laws
4.1
Employers in Singapore Adopt a Pledge of Fair Employment Practices
4.2
Tattoos in the Workplace
5.1
Hiring a Social Media Director
5.2
Caseworkers Often Face Tremendous Difficulties
6.1
EEOC Cautions against Making Employment Decisions Based on Criminal Records
6.2
Barring Discrimination against Unemployed Applicants
7.1
Compensation and Retirement Benefits Reform in New York State
7.2
The Gender Gap in Wages Still Exists in 2011
8.1
Smokers Need Not Apply
8.2
Public Pensions Are Undergoing Changes
9.1
Using Video Games for Driver Training
9.2
Swapping Jobs
10.1
Office of Personnel Management Director Says Federal Employees Need More Frequent Feedback
10.2
Ethical Lapses and Performance Problems at the Stanislaus Community Assistance Project
11.1
Union Members in Spain and Italy Go on Strike
11.2
Labor Talks and Social Media
12.1
Voluntourism
12.2
Millennials’ Job Satisfaction Is Increased by Corporate Volunteer Programs
PREFACE
Strategic human resources management (SHRM) is the integration of human resources management (HRM) with the strategic mission of the organization. It adapts human resources policies and practices to meet the challenges that agencies face today, as well as those they will face in the future. Human resources management departments must take a proactive role in guiding and supporting agency efforts to meet the changing demands of their external and internal environments.
This fourth edition updates the current knowledge, HRM practices, and legal, social, economic, and technological environment in which public and nonprofit organizations operate in.
Since the third edition, HRM has undergone some significant changes. Many states are attempting to modify the collective bargaining rights of public employees or are moving in the direction of passing “right-to-work” legislation, which has implications for collective bargaining. There have been changes to a number of federal laws that have an impact on HRM, and the public and nonprofit sectors are undergoing tremendous changes with increases in retirements and layoffs. Federal, state, and local governments are realigning their workforces and developing new HRM policies and practices.
There have been changes to a number of federal laws that have an impact on HRM, and the public and nonprofit sectors are undergoing tremendous changes with increases in retirements and layoffs. Federal, state, and local governments are realigning their workforces and developing new HRM policies and practices. The political environment and the economy have changed since the last edition, bringing about changes in SHRM. Social media are being used at an increasing rate for the recruitment of potential employees, and there have been National Labor Relations Board decisions in regard to employees’ use of social media. The economic crisis has forced government to rethink the way it operates. There have been cuts to staffing and operating hours, agency consolidation and cross-agency service delivery, and a greater reliance on for-profit and nonprofit organizations to deliver services. These changes have occurred simultaneously with increasing demands for less expensive but more effective services. The realignment of public and nonprofit agencies requires that managers and administrators take a strategic perspective and recruit, motivate, and retain competent and professional employees.
The new public service has become more diverse. Changing demographics have resulted in an increase in the number of employees who are women, members of ethnic and racial minorities, persons with disabilities, and employees from different generations with different knowledge, skills, abilities, and other characteristics. Graduates of schools of public policy and administration are likely to take jobs in the nonprofit sector and show a greater interest in seeking employment opportunities in the private sector. Today’s graduates are moving across the public, nonprofit, and for-profit sectors, looking for challenging work and the opportunity to learn new skills. Master’s of business administration graduates are also looking for challenging work. This presents an opportunity and challenge for public and nonprofit organizations to design an HRM system that will recruit those who want a challenge that keeps them motivated and enables them to make a difference through their work.
Changes in information and communication technologies have led to the restructuring of many public and nonprofit agencies. Advances in technology have enabled employees to work from their homes, provided opportunities for more flexible work hours, and increased the employment options for disabled individuals. Smart telephones, tablets, networks, videoconferencing, and streaming video have changed communication patterns. Information and computer technologies are increasingly being used not only to automate routine tasks but also to restructure and integrate service delivery procedures and programs. Social media such as LinkedIn, Facebook, Twitter, and YouTube have become common communication tools, and more agencies are using human resources information systems (HRIS) for routine HRM tasks as well as to aid in performance management and decision making.
Organizations must do more than just adapt to internal changes. They must also seek better ways to meet the expectations of citizens, clients, funding sources, foundations, elected officials, boards of directors, interest groups, and the media.
The public sector is becoming less involved in direct service delivery. Government at all levels is increasingly relying on nonprofit and private sector organizations to provide services. Government work is being implemented through a network of contracting, intergovernmental grants, vouchers, tax credits, regulations, and other indirect administrative approaches. While the public sector in particular is reducing the number of individuals it directly employs, it continues to need a sizable shadow to accomplish its mission (Light, 1999). These employees are part of the shadow that is created when public goods and services are provided through private, nonprofit, or state and local entities.
Declining revenues combined with demographic changes, changes in employees’ values, and the need to retain effective workers are some of the forces that have compelled public and nonprofit organizations to become concerned with their very survival. These changes require a more flexible and skilled workforce. To be successful, organizations need employees with new skills. Public managers need skills in team building, communication, engaging employees, managing a diverse workforce, and performance management. These skills have HRM implications for employee recruitment, selection, and training. Public and nonprofit sector jobs are increasingly professional in nature, requiring higher levels of education. At the same time, there is a decrease in jobs that are physically demanding. Employees in public and nonprofit agencies often deal with a variety of people, many of whom have a stake in the agency. Taxpayers, clients, customers, elected officials, donors, contractors, board members, and special interest groups are just some of the stakeholders concerned about agency performance. Employers must ask themselves how to meet the public’s objectives and satisfy the organization’s stakeholders.
The changing nature of job responsibilities has rendered knowledge management more important for agencies. Workers define the character of agencies, affect an agency’s capacity to perform effectively, and represent the knowledge base of the organization.
To be strategic partners, HRM departments must possess high levels of professional and business knowledge. HRM must establish links to enhancing organizational performance and be able to demonstrate on a continuing basis how its activities contribute to the organization’s success and effectiveness.
Public and nonprofit agencies must be flexible and attuned to the needs of society. They must seek to improve the quality of their services by engaging in SHRM. Recruitment and selection strategies must be innovative, career development opportunities must be provided, work assignments must be flexible, and policies must reward superior performers and hold marginal employees accountable. These policies must be developed and administered according to the principles of equity, efficiency, and effectiveness. Performance standards must be designed to promote the goals and values of organizations.
Historically, HRM has been seen as Cinderella—on the periphery, not integrated into the core of agency functions. Fitz-enz (1996, p. 3) notes that historically, personnel departments were either dumping grounds for “organizational casualties”—likable employees who were not proficient in other tasks—or staffed with employees from line functions, neither of whom had any formal education in personnel administration. He also attributes the peripheral relationship of HRM departments to other functional departments to the fact that for years, it was believed that organizations could not measure or quantify what the HRM department accomplished or contributed to the organization’s bottom line. HRM departments did not speak in financial terms, the common denominator of business language, and were not very good at communicating the relationship between successful HRM programs and organizational success. As a result, most HRM departments were denied access to the organization’s strategic planning processes and forced into reactive activities instead of being allowed to collaborate with the other management teams to formulate policies and determine future objectives. This approach has been a mistake. Research in the private sector has found that returns on wise HRM policies can surpass returns from other resources (Cascio, 2000; Cascio & Boudreau, 2008; Fitz-enz, 1996, 2002, 2009, 2010). In the public and nonprofit sectors, where 60 to 80 percent of expenditures are for personnel, SHRM is even more important than in the private sector.
Purpose and Audience
This book addresses SHRM issues in nonprofit and public agencies. Although many textbooks address public personnel or HRM, only a few are dedicated to the nonprofit sector, thus omitting a significant partner that provides services beneficial to society. Topics such as recruiting and managing volunteers and working with a board of directors have not been addressed. There are other omissions as well, such as a discussion of nonprofit labor relations. For example, nonprofit labor relations are governed by the amended National Labor Relations Act (the Labor-Management Relations Act), while most federal employees fall under the Federal-Service Labor-Management Relations Statute (Title VII of the Civil Service Reform Act of 1978), and state and local government employees are guided by their respective public employee relations statutes, which have recently been threatened by new legislation. Social media have also had an impact on SHRM. The National Labor Relations Board has offered rulings on employees’ use of social media to post complaints or criticisms. In the public sector, an applicant’s or employee’s religion is irrelevant, and discrimination because of religion is prohibited. However, religiously affiliated nonprofits that provide services of a religious nature may, in special circumstances, discriminate against applicants or employees on the basis of their religion.
The emphasis in this book is on nonprofits that are closely associated with providing a public benefit or service or with solving a problem on behalf of the public interest. It focuses on nonprofits that are responsible for delivering health care, social services, education, arts, advocacy, and research. The objectives of these nonprofits often parallel those of many government agencies in terms of the individual and community services they provide.
Public organizations and nonprofits are similar in that they define themselves according to their missions or the services they offer. These services are often intangible and difficult to measure. The clients receiving public or nonprofit services and the professionals delivering them make very different judgments about the quality of those services. Both sectors are responsible to multiple constituencies: nonprofits are responsible to supporters, sponsors, clients, and government sources that provide funding and impose regulations; and public agencies to their respective legislative and judicial branches and to taxpayers, cognate agencies, political appointees, clients, the media, and other levels of government (Kanter & Summers, 1987; Starling, 1986). Lipsky and Smith (1989–1990) comment that public and private service organizations share many characteristics: the need to process clients through systems of eligibility and treatment, the need to maintain a competent staff to be effective, and the need to account for financial expenditures. These organizations are also expected to be fair (equitable), accommodate likely and unanticipated complexities (responsive), protect the interests of sponsors in minimizing costs (efficient), be true to their mandated purposes (accountable), and be honest (fiscally honorable).
The conceptual foundation of this book is SHRM, the integration of human resources management with the strategic mission of the organization. It adapts human resources policies and practices to meet the challenges agencies face today, as well as those they will face in the future. Human resources departments must take a proactive role in guiding and supporting agency efforts to meet the changing demands of their environments. The information provided in this book can improve the effectiveness of HRM activities.
In many organizations, HRM policies and practices develop as needed, with little integration of the organization’s future needs. Often policies are developed to solve an immediate problem, with no thought to their long-term implications. Such policies and practices lock the agency into inflexible modes of operation, leaving them unable to see that other strategies might be more appropriate.
This book emphasizes the importance of HRM functions, revealing them as major contributors to the accomplishment of the agency’s mission now and as the agency changes. The purpose of the book is to provide practitioners, policymakers (such as elected officials), and board members of local, state, federal, and nonprofit organizations with an understanding of the importance of SHRM in managing change. It provides the guidance necessary to implement effective HRM strategies.
The book was also written to be a textbook for use in public administration and nonprofit management graduate programs that offer courses in personnel administration, HRM, strategic planning, and nonprofit management. Although the literature on nonprofit management has increased in recent years, little information exists that addresses nonprofit HRM concerns. This book should help fill that void. As more public administration programs offer a specialization in nonprofit management, it is important that resources be available to target the challenges that both the public and nonprofit sectors face. Although the primary focus of this book is public and nonprofit SHRM in the United States, there are examples as well of HRM practices in other countries. As you read the chapters, there are examples of HRM practices in other countries and you will be asked to think about them and make comparisons to HRM practices in the United States.
Overview of the Contents
Part 1 introduces the context and environment of human resources management. Chapter 1 discusses HRM and explains what public and nonprofit organizations are, how society and workplaces have changed, and the HRM implications of those changes. Chapter 2 explains how SHRM and human resources planning are imperative if agencies are going to remain competitive and be able to accomplish their missions; it also discusses how the role of human resources specialists has to change as well and explains human resources information systems (HRIS). Chapter 3 presents the legal environment of HRM, and chapter 4 discusses the importance to organizations of managing diversity if they are to prosper.
Part 2 presents the techniques and functional areas of HRM with examples in each chapter. Chapter 5 explains the importance of job analysis before executing HRM policies or developing job descriptions, performance appraisal instruments, training and development programs, and recruitment and selection criteria. It discusses as well a variety of job analysis techniques. Chapter 6 explains recruitment and selection techniques; summarizes drug testing, physical ability tests, psychological examinations, and other selection techniques used in the public and nonprofit sectors; and explains important psychometric concepts. It also provides information on practical intelligence, emotional intelligence, adaptability, multiple intelligences, and organizational citizen performance behaviors. Chapter 7 identifies the internal and external factors that influence compensation policies and practices, discusses techniques used to develop pay systems, offers examples of job evaluation, and looks at nontraditional pay systems. Chapter 8 turns to employer-provided benefits and pensions. It also discusses violence at work and workplace bullying.
The focus of chapter 9 is training and development activities. Changes in technology and demographics and the development of new responsibilities and expectations have made training and career development more important than ever before. It identifies training needs; explores the development of training objectives and the curriculum and evaluations of training; and summarizes a variety of training formats. The chapter concludes with examples of management training and career development programs.
Performance management and evaluating employees’ performance are the focus of chapter 10. It explains different performance appraisal techniques and their strengths and weaknesses, the importance of rater training and documentation, ethical issues in performance appraisal, merit pay and 360-degree evaluations, and employee discipline. Chapter 11 discusses collective bargaining in the public and nonprofit sectors: the legal environment of labor-management relations for nonprofit, federal, state, and local employees; and definitions and explanations of such concepts as unit determination, union security, unfair labor practices, management rights, impasse resolution, and grievance arbitration. The reasons that unions exist in the public and nonprofit sectors are examined.
The importance of managing volunteers and how SHRM practices can assist in making the volunteer experience productive for the agency and satisfying to the volunteers and board members is the topic of chapter 12. The book ends with a summary of the key lessons presented in the book, which I hope will convince public and nonprofit administrators of the importance of strategic HRM.
Joan E. Pynes
Tampa, Florida
June 2013
ACKNOWLEDGMENTS
A number of people have made valuable contributions to this book. I thank Alison Hankey and Alina Poniewaz of Jossey-Bass, as well as the four anonymous reviewers, for their helpful comments and suggestions, which whenever possible I have added to this fourth edition.
As in the previous editions, friends, colleagues, and students provided assistance by contributing workplace examples, reviewing chapters, or both. Specifically, I thank Anne Goldyche Dailey, Patricia Goldstein, and Patricia Murray for their observations of working in and with public and nonprofit agencies. More thanks are extended to Lisa Suprenand, who developed chapter questions, exhibits, tables, and PowerPoints (available on the Instructor’s website: www.wiley.com/college/pynes) for this edition.
Special acknowledgment goes to my husband, Mike McNaughton, for his sense of humor and editorial assistance. I also express my appreciation to my sister, Robyn, and Mike for their encouragement. Like the earlier editions, this book is dedicated to my mother, who always inspired me to do my best.
THE AUTHOR
Joan E. Pynes is a professor of public administration at the University of South Florida. She received her B.A. degree (1979) in public justice from SUNY Oswego and her M.P.A. (1983) and Ph.D degrees (1988) in public administration from Florida Atlantic University.
She is the author or coauthor of four books, most recently coauthor of Human Resources Management for Health Care Organizations: A Strategic Approach (Jossey-Bass, 2012) and Effective Nonprofit Management: Context and Environment (M. E. Sharpe, 2011). She is also the author or coauthor of more than fifty academic articles, book chapters, technical reports, and encyclopedia entries about public and nonprofit human resources management.
PART ONE
HUMAN RESOURCES MANAGEMENT IN CONTEXT
Public and nonprofit organizations are confronting a variety of economic, technological, legal, and cultural changes with which they must cope effectively if they are to remain viable. The key to viability is well-trained and flexible employees. To be responsive to the constantly changing environment, agencies must integrate their human resources management (HRM) needs with their long-term strategic plans. The four chapters in this part explain how society and workplaces have changed and the strategic human resources management (SHRM) implications of these changes for organizations.
Chapter 1 discusses some of the differences between public sector agencies and nonprofit organizations. It reviews some of the external factors that affect the internal operations of an organization, such as changes in economic conditions and the fiscal uncertainty that such changes can bring to an agency, and the social and cultural changes affecting the demographic composition of the workforce. Most organizations today have a more diverse group of employees than ever before, bringing different experiences and new expectations into the organization. The legal environment must always be monitored for change. Equal employment opportunity, labor relations, and compensation and benefits are all regulated by law.
There is also an increased emphasis on accountability and performance management in public and nonprofit organizations. Staff need critical knowledge skills, abilities, and other characteristics to perform specific jobs, but they also need to be flexible and willing to deal with rapid and unstructured change. Knowledge-specific skills and general competencies are important. To make this possible, HRM needs to be more closely integrated with the organization’s objectives and mission.
Chapter 2 addresses the strategic side of HRM and the importance of strategic human resources and human resources planning. It explains why SHRM and HRM planning are critical to agencies’ missions. SHRM believes that realistic planning is not possible unless strategic planning takes into consideration information on current and potential human resources. Human resources planning requires the assessment of past trends, an evaluation of the current situation, and the projection of future events. The external and internal environments must be scanned, and changes that might affect an organization’s human resources must be anticipated and planned for. Also discussed is the effect of information technologies on SHRM. Technological changes such as the increased use of computers, information systems, databases, telecommunications, and networking have changed the way agencies are structured and work is organized and managed. Organizations need to recruit, hire, and provide training to individuals who have the skills and motivation to adapt to technological changes.
Chapter 3 focuses on the legal environment and the federal laws governing equal employment opportunity. Equal employment opportunity requires that employers not discriminate in the administration and execution of all HRM practices, such as recruitment, selection, promotion, training, compensation, career development, discipline, and labor-management relations. To understand the legal environment of equal employment opportunity, public and nonprofit administrators must be familiar with the laws and regulations that govern its implementation.
Chapter 4 is devoted to exploring the issues of managing a diverse workforce. As already noted, the composition of public and nonprofit workforces has changed. Women, racial and ethnic minorities, returning war veterans, and older, disabled, homosexual, and transgendered workers are more visible in today’s workplace than in the past. Other types of diversity issues exist in agencies as well. Diversity must be understood if organizations want to deal effectively with employees regardless of their different characteristics. When diversity is well managed, all employees are supported, valued, and included. A supportive work environment enables employees to achieve their fullest potential.
CHAPTER ONE
INTRODUCTION TO HUMAN RESOURCES MANAGEMENT IN THE PUBLIC AND NONPROFIT SECTORS
After reading this chapter, you should be able to
Understand the responsibilities and roles of human resources management
Understand what constitutes public organizations
Explain why civil service systems or merit systems exist in the public sector
Understand what constitutes nonprofit organizations
Identify the challenges facing human resources management today
Human resources management (HRM) is the design of formal systems in an organization to ensure the effective use of employees’ knowledge, skills, abilities, and other characteristics (KSAOCs) to accomplish organizational goals. HRM concerns the recruitment, selection, training and development, compensation and benefits, retention, evaluation, and promotion of employees, and labor-management relations within an organization. In public and nonprofit agencies, the greatest expenses and the greatest assets are employees. Unlike many for-profit organizations that can use technology to automate the production of their products and reduce staff, public and nonprofit organizations typically provide some type of service. Thus, they rely on the professionalism and competence of their employees.
Machines cannot be substituted for most public and nonprofit employees. As a result, public and nonprofit agencies are labor intensive; employee costs are typically between 50 and 80 percent of their budgets (Cascio & Boudreau, 2008; Fitz-enz, 2000, 2009, 2010). Employees are also public and nonprofits’ greatest assets. Whether referring to top leadership, department directors or managers, or first-level employees, the quality and competencies of the workforce differentiate successful agencies or departments from others. Why is one police department more effective than another when dealing with similar problems and situated in local governments with similar incomes and demographics and with similar responsibilities? Why is one substance abuse treatment center more effective than another if they are using similar clinical protocols and techniques and have clients with similar problems? The answer is likely to be related to the professionalism and competencies of their employees. The study of HRM has existed for a long time, despite having different names. Scientific management addressed the principle of breaking job positions down into their simplest tasks. It was concerned with production efficiencies through making the best employee and job match and also addressed employee motivation by developing incentive pay systems.
Additional psychological aspects of HRM were developed to select individuals for military positions. Intelligence, aptitude, and psychological tests were developed to screen and place employees in various positions. The field of industrial/organizational psychology has played, and continues to play, a critical role in the development of HRM activities. Human resources management has evolved to encompass systems for the effective recruitment, selection, evaluation, and training and development of employees. Compensation studies to pay employees fair salaries and provide them with benefits that are important to them are also important components of HRM systems. Fair compensation serves to retain and motivate employees.
Human resources management responsibilities change as society changes. Today, public and nonprofit organizations are facing serious economic challenges, changes in the legal environment, and social, cultural, generational, technological, and educational changes. A strategic HRM system identifies these changes and challenges and develops effective strategies to address them.
The Public Sector
The public sector is composed of a variety of government organizations. Government agencies are owned and controlled by the people. Government is used to maintain a system of law, justice, and social organization. It protects individual rights and freedoms, provides security and stability, and provides direction for the nation. It also provides public goods, regulates certain industries and activities, and corrects problems that the markets create or are unable to address (Rainey, 2003).
In the United States, we have a variety of federal, state, and local government agencies. Federal employees work directly for federal agencies and receive their compensation and benefits from the federal government. Federal Bureau of Investigation agents are federal employees, as are doctors working for the National Institutes of Health and the Centers for Disease Control. Other federal employees may work for the Federal Aviation Authority, the Securities and Exchange Commission, and the Food and Drug Administration. (To see the scope of federal departments and agencies, go to http://www.whitehouse.gov/government/independent-agencies.html.) In 2010, more than 3 million civilian employees were employed directly by the federal government (US Census Bureau, 2012h).
State employees work directly for state agencies and receive their compensation and benefits from state governments. Each state has a different number of agencies. The compensation and benefits given to state employees vary across the states. In 2010, 5.3 million employees were employed directly by state governments (US Census Bureau, 2012g).
There are more than eighty-eight thousand units of local government: counties, cities, villages and townships, and special districts such as school districts, fire districts, park districts, hospital districts, museum and zoo districts, and parks and recreation districts. Local government employees work directly for local units and receive their compensation and benefits from the local governments and taxing districts. The number of local units varies across the states, as do compensation and benefits given to local government employees. Even within the same county, county employees may be paid different salaries from employees working for city governments located in the county. Also, special district employees receive different salaries and benefits. There is often little consistency across local government units. In 2010, the number of local government employees was 14.2 million. Most public employees work for local units (US Census Bureau, 2012f).
Individuals working directly for federal, state, or local units are considered to be government employees. In a democracy, government is owned by all of its citizens, and most of the revenues that support government agencies typically come from taxes. Government’s objectives are political in nature. Public agencies are influenced by certain values found in the private sector such as efficiency, effectiveness, timeliness, and reliability. But they are also influenced by values not necessarily found in the private sector and often are in conflict with one another, such as accountability to the public at large and to elected officials, being responsive to the rule of law and governmental authorities, being responsive to public demands, being open to external scrutiny and criticism, adhering to strict ethical standards, and conducting public affairs with the goals of fairness, equal treatment, social equity, and impartiality (Rainey, 2003).
Civil Service and Merit Systems
Many public agencies are required to comply with civil service or merit systems to facilitate these values and objective employment practices in public agencies:
Federal government
. The Pendleton Act, passed in 1883, set up an independent, bipartisan civil service commission to make objective, merit-based selections for federal jobs. Those individuals best qualified would receive a job or promotion based on their KSAOCs. The terms
civil service system
and
merit system
are often used interchangeably. This is because merit provides the foundation for civil service systems. The ability to perform tasks is dependent not on political affiliation but on individual skills and abilities (i.e., merit considerations). The intent of the merit system was to remove the negative effects of patronage (granting jobs to political supporters) in appointing individuals to federal positions. Public employees were expected to perform their work in a politically neutral manner. In 1978, the Civil Service Reform Act made changes to federal personnel policies. The Civil Service Commission was eliminated, and the Office of Personnel Management and the Merit Systems Protection Board took its place. However, being politically neutral, along with experience, education, and expertise, are still important criteria for selecting federal employees.
State governments
. The federal government encouraged state and local governments to develop civil service or merit systems as a condition of receiving federal grants (Aronson, 1974). The federal government has a vested interest in seeing that state and local programs supported by its funds are administered in an efficient and professional manner. The recipients of federal monies were to ensure the proper administration of grant programs. Standards were initially issued in the 1930s and continued through the 1970s when the Intergovernmental Personnel Act of 1970 was passed, which gave grants to state and local governments to improve their personnel practices. The authority for state merit systems is typically outlined in state statutes, which direct a specified agency to issue the necessary rules and regulations that have the effect of law and the necessary administrative procedures to carry out its provisions. Most civil service systems have independent civil service commissions that are patterned after the first Civil Service Commission. They are bipartisan in composition and usually have three to five members who serve staggered terms and are typically appointed by the governor. They are usually responsible for overseeing hiring and promotions, but they may also be involved in adjudicating grievance or discharge hearing and developing or approving job classification schedules.
Local governments
. The administrative structure and the authority granted to local governments are typically found in their charters. This provision for chartering local governments is found in state constitutions and state statutes. For example, the Illinois state statute permits seven varieties of local government structure: aldermanic-city, trustee-village, commission, manager, special charter, strong mayor, and administrator. Each form has its own rules for the selection and type of officers, their powers and responsibilities, and their general operations. Any municipality may adopt the civil service provisions of the Illinois Municipal Code, but they are not required to do so. Should they adopt civil service provisions, they must adhere to them. All relevant officers and employees must be appointed, promoted, and removed according to civil service rules.
In jurisdictions with civil service systems in place, applicants are typically appointed after they have passed a standardized selection procedure. The selection procedure could consist of written examinations, a combination of prior experience and education, or oral interviews. Where competition exists for positions, candidates are ranked by their scores from high to low, with the agency appointing one of the top-ranking candidates.
Different rules apply to different civil service systems. Some systems allow managers to select one of the top three ranked candidates to be selected, others allow one of the top five ranked candidates to be selected, and others allow a larger range of acceptable candidates. Some public employees are exempt from civil service requirements. The exemptions permit chief executives to select people who are in agreement with their priorities for policymaking and politically sensitive posts. In most state and local governments, department directors are appointed by the chief executive. Many public sector HRM regulations and responsibilities are codified in statutes, which means that any changes need the respective legislative body to make the change. Chief executives and managers often have limited administrative and managerial discretion, and increases in compensation and benefits are often dependent on legislative approval.
Public agencies often grant hiring preference to veterans of the US armed services. Additional points may be added to the scores of eligible veterans applying for public sector positions.
Economic Challenges
More than 46 million people in the United States are living poverty, and at least 16 million of them are children younger than sixteen. The poverty rate for blacks is 27.6. percent, Hispanics 25.3 percent, non-Hispanic whites 9.9 percent, and Asians 12.3 percent. For children under eighteen years old, the poverty rate is 21.9 percent (DeNavas-Walt, Proctor, & Smith, 2012). When times are tough, the demand for public services grows. Low-income residents are dependent on a variety of services, such as housing assistance, assistance for medical care, food, unemployment benefits, transportation, and utility bills.
Middle-income Americans are increasingly concerned about jobs, health insurance, pensions, housing, and income security. Wage and salary increases have not kept up with increases in the cost of housing, gasoline, food, education, and insurance. Residents concerned about their living expenses tend to keep a close eye on government spending and want tax relief. At the same time, state and local governments are facing budget deficits and have to make budget cuts. Problems with the housing markets and foreclosures, leading to reduced property taxes, reductions in sales taxes due to declines in consumer spending, and increasing unemployment rates have led to reductions in spending, so state and local revenues are falling. As a result of difficult economic times, public agencies are looking to reduce expenses. Strategies to save money include not hiring employees with benefits and instead hiring supplemental direct-hire employees who work irregular hours; they receive a paycheck from the agency for time worked but do not receive health insurance, retirement pensions, vacation or sick leave, and other benefits. In some organizations, they are referred to as other personnel services workers.
Governments are also using more contract workers. These workers work for public agencies, but they are procured through a staffing agency or other third party. These arrangements, as well as seasonal, part-time, on-call, and temporary agency work, are referred to as nonstandard work arrangements. Many previously employed full-time workers are now filling short-term openings as contractors, consultants, freelancers, and temporary workers (Grossman, 2012; Thompson & Mastracci, 2005; “Surge in Temp Jobs,” 2012). A survey conducted by the Society for Human Resource Management (SocHRM) found the primary reasons that agencies hire temporary workers include to complete specific projects (27 percent); as additional resources during busy times or cycles (25 percent); as a gap filler until they can hire full-time employees (17 percent); as a way to try out workers for full-time jobs (13 percent); to reduce benefits and other labor costs (95 percent); and because they have difficulty filling key skill positions (4 percent); and other reasons (6 percent) (SocHRM, 2011, cited in Grossman, 2012).
Alternative Service Delivery
Privatization and contracting out occur when public sector agencies contract with private nonprofit, private for-profit, or other public agencies to provide specific services. A typical privatization agreement specifies that a private or nonprofit entity is responsible for producing particular services. The public employer chooses the service level and pays the amount specified in the contract, but leaves decisions about production methods to the contracted firm. From an administrative perspective, privatization is often viewed as a way to save tax dollars, reduce the public payrolls, minimize government spending, and boost productivity.
Supporters claim that contracting out government programs will lead to greater efficiency and more effective operations. They maintain that competition and fewer restrictions allow the contractors to be more cost-efficient and responsive and that cost savings can be achieved through the economies of scale used by one vendor to provide services to many communities and organizations. It is believed that nonprofit and private firms, not hampered by bureaucratic rules and regulations, can be more innovative than public sector ones (Savas, 2000, 2002). However, research on the cost savings of privatization is inconclusive. There are examples of sweetheart deals with contractors, cost overruns, inefficiencies, and less-qualified staff providing important services. Furthermore, transparency, accountability, and concern for the public interest are often lacking (Feeney & Kingsley, 2008; Greenblatt, 2004; Moe, 1987; Sclar, 2001; Starr, 1987).
Technological Innovations
Innovations in technology are changing the way organizations are structured and how work is organized and managed. More agencies are embracing telework. The General Services Administration’s Office of Strategy Management implemented a thirty-day “telework wave” where employees were supposed to report to their offices and instead work from home or other GSA buildings. The purpose was for them to learn different patterns of behavior, different patterns of communication, different cultures, and different ways of operating (Rausnitz, 2012).
Approximately one in five workers worldwide telecommute according to a poll conducted by Ipsos/Reuters. Telecommuting is most popular in India, where more than 50 percent of workers were working from home, followed by 34 percent in Indonesia, 30 percent in Mexico, and smaller percentages in Argentina, South Africa, and Turkey. Less than 10 percent of people work from home in Hungary, Germany, Sweden, France, Italy, and Canada. The treasurer of Cuyahoga County, Ohio, has replaced five workers with an automated tax processing system. Instead of opening envelopes and scanning and encoding checks, an automated processing system provides those functions (Johnston, 2011).
Police departments are turning to an online talking animated virtual officer to assist residents in filing an online crime report for nonemergency crimes on the police department’s website (Powers, 2012), and a mobile application is helping US Fish & Wildlife Service refuge officers identify potentially dangerous suspects and stay connected to colleagues while conducting investigations in remote locations. Using an application called PocketCop, an officer can connect to the FBI National Crime Information Center database and run background checks.
Key SHRM challenges facing organizations will be the ability to attract and hire qualified applicants and provide training for incumbent employees so that the benefits of technology can be realized.
The Nonprofit Sector
Nonprofit sector is the collective name used to describe organizations that are not government or private for-profit organizations. They have also been called the voluntary sector, the third sector, and the philanthropic sector. Nonprofit organizations are chartered by each state and are conferred special tax-exempt status by the states and the Internal Revenue Service (IRS). The IRS exempts nonprofits from paying federal corporate income taxes, and state and local governments may grant nonprofits exemptions from property and sales taxes.
To be recognized as a nonprofit, an organization must possess the following general characteristics: (1) it is specifically designated as a nonprofit when organized; (2) profits or assets may not be divided among corporate members, officers, or directors in the manner of corporate dividends; and (3) it may lawfully pursue only such purposes as are permitted for such organizations by statute (Oleck, 1988). Internal Revenue Code section 501(c) lists the types of associations, corporations, and trusts that can qualify for federal tax exemption (table 1.1).
Table 1.1. IRS Organization Reference Chart
Source: IRS Publication 557 www.irs.gov/pub/irs-pdf/p.557.pdf (pp. 60–61).
The largest nonprofit classification is 501(c)(3) nonprofits, referred to as public charities (table 1.2). The IRS defines a public charity as an organization that normally receives a substantial portion of its total income directly or indirectly from the general public or government. This is different from 501(c)(5) (labor and agricultural organizations) and 501(c)(6) (business leagues) classifications, which derive most of their money from members and are organized to primarily serve the interests of their members (Urban Institute, 2012).
Table 1.2. Number of Nonprofit Organizations in the United States, 1999–2009
Sources: IRS Business Master File 04/2010 (with modifications by the National Center for Charitable Statistics at the Urban Institute to exclude foreign and governmental organizations). Retrieved from http://nccsdataweb.urban.org/PubApps/profile1.php?state=us. Used with permission of the Urban Institute.
The National Taxonomy of Exempt Entities, developed by the National Center for Charitable Statistics, provides this classification system for public charity nonprofit organizations:
There are nine major groups, twenty-six categories, and over four hundred subcategories (table 1.3).
Table 1.3. National Taxonomy of Exempt Entities: Broad Categories
Major Group
Arts, culture, and humanities
A
Education
B
Environment and animals
C, D
Health
E, F, G, H
Human services
I, J, K, L, M, N, O, P
International, foreign affairs
Q
Public, societal benefit
R, S, T, U, V, W
Religion-related
X
Mutual/membership Benefit
Y
Unknown, unclassified
Z
501(c)(3) Nonprofits
Charitable nonprofits are private organizations that serve a public purpose. They operate under a nondistribution component, which prohibits the distribution of profits or residual earnings to individuals who control the entity. As such, it is believed that they possess a greater moral authority and concern for the public interest than private for-profit organizations. Nonprofits often perform public tasks that have been delegated to them by the state or for which there is a demand that neither government nor for-profit organizations offer. They provide myriad services, such as helping the disadvantaged, providing medical services, supporting museums and cultural activities, preserving the environment, and funding medical research. Because of their public-serving nature, individual and corporate donations to 501(c)(3) public charity nonprofits can deduct the value of the gift from their taxable income.
Nonprofits are thought to be more flexible than government agencies. They can experiment with new programs, responding quickly to new social needs. Instead of getting involved in new or controversial programs, government often gives money to nonprofit agencies to do this work instead. Nonprofits thus get financial support, and clients receive services. Government, through the conditions it places on agencies that receive public funds, still has some influence but can quickly disassociate itself from programs when things go wrong. There are often certain societal needs that may be too expensive to be provided on a private for-profit basis. Therefore, in the United States, both government and the nonprofit sector provide certain services whose costs exceed their market value (Douglas, 1983; O’Neill, 1989; Salamon, 2012; Weisbrod, 1997).
Public administration practitioners and scholars have increased their attention to nonprofit organizations as governments have more frequently used such agencies to provide health and human services. Among the examples are organizations established to prevent child abuse, domestic violence, or homelessness; assist the disabled, the elderly, or the mentally ill; or provide day care, counseling, vocational training and rehabilitation, or community and neighborhood centers (Kramer & Grossman, 1987; Lipsky & Smith 1989–1990; Salamon, 2012).
Public assistance reaches nonprofit organizations indirectly through federal, state, and local governments that contract with nonprofit agencies to provide public services. Many people do not realize that “rather than depending mostly on private charity and volunteers, most nonprofit service organizations depend on government for over half of their revenues; for many small agencies, government support comprises their entire budget in contrast to the traditional relationship of two independent sectors; the new relationship between government and nonprofits amounts to one of mutual dependencies that is financial as well as technical. The lines between public and private are blurred” (Lipsky & Smith, 1989–1990, p. 625).
This blurring is especially vivid in health and human services. Government, nonprofit, and for-profit organizations are subject to similar regulations, dependent on the same revenue sources, hire the same types of professional staff, and perform similar functions. However, public organizations and nonprofits are similar in that they define themselves around their missions or the services they offer. These services are often intangible and difficult to measure. Both sectors are accountable to multiple constituencies. Nonprofits must be responsive to supporters, sponsors, clients, and government sources who provide funding and impose regulations. Public agencies must be responsive to their respective legislative and judicial branches, taxpayers, cognate agencies, political appointees, clients, the media, and other levels of government.
501(c)(4) Nonprofits
Social welfare organizations are often referred to as advocacy organizations. The American Civil Liberties Union, the National Rifle Association, and the Sierra Club are examples. They cannot receive tax-deductible gifts, they engage in lobbying activities, and they can advocate for specific issues. They, along with 501(c)(3) nonprofits, constitute what is referred to as the independent sector and are public serving. Many 501(c)(4) nonprofits have affiliated 501(c)(3) nonprofits to assist with fundraising, and they often establish foundations since donations to them are not tax deductible. And many 501(c)(3) nonprofits have affiliated 501(c)(4) organizations to engage in lobbying and advocacy activities. This is because 501(c)(3) nonprofits have more restrictive limits on their lobbying and political advocacy activities than 501(c)(4) nonprofits do.
Public charity 501(c)(3) and social welfare 501(c)(4) nonprofits share a common purpose of serving the public. They also share community-oriented values of public administration, such as being responsive, being open to external scrutiny and criticism, conducting public affairs with the goals of fairness and social equity, addressing what they perceive to be community or societal problems, and defending individual rights, commitment to democratic ideals, and citizen and community participation and involvement. They are mission driven, and although operating in the black is a goal, profit is not the reason for their existence. Public and nonprofit administrators must behave responsively and ethically at all times, acting in the public interest.
The Alliance for Justice provides live as well as online workshops and publishes booklets and fact sheets on the permissible advocacy activities for 501(c)(3) and 501(c)(4) organizations. Nonprofits organized under section 527 are permitted to be active in political campaigns, although they cannot communicate with candidates or members of their staffs and advocacy activities.
Nonprofit Administrative Structures
A nonprofit’s administrative structure is governed by its bylaws, internal documents that typically define most operational and management policies. Bylaws regulate the organization’s procedures and internal practices, as well as define the duties, powers, and limitations of the directors, officers, and other agents. Like all other important documents, bylaws should be reviewed periodically and updated.
Nonprofit organizations possess legal power. Directors are elected or appointed to the board and are authorized to manage and direct the affairs of the organization. They act on behalf of the organization but do not have ownership powers within it; their control is managerial and proprietary. They are free only to change policies and short-range purposes unless the charter or bylaws permit the directors to change the fundamental purpose or policies. Many states permit the delegation of direct authority to committees to study and make recommendations about some matter or to manage routine affairs.
The human resources committee, responsible for developing personnel policies, may recommend employee and executive director salary ranges and benefit packages to the board, as well as evaluate the executive director. It may also handle employee grievances. Although the board may delegate its authority to committees, it has not delegated its responsibility; it must still supervise and hold accountable the activities of the committees.
The nonprofit sector is often referred to as the voluntary sector because nonprofit agencies are often dependent on the use of volunteers to assist in executing their missions. Additional information on volunteers and governing boards is provided in later chapters.
501(c)(3) Nonprofits
Nonprofits are facing severe economic challenges. Declines in public revenues mean less support for many of these organizations. Uncertain financial times place additional stresses on them. Increased unemployment often requires the expansion of food assistance, medical aid, job training, rent assistance, or retraining services. These services are typically provided by nonprofit agencies, which must absorb an increase in demand for services without increasing their staffs and possibly facing layoffs themselves. An additional problem is that the reimbursement rates provided by governments are often below the true costs of providing services. Due to the decreased funding, some states have also been late in reimbursing nonprofits for the services already rendered.
Nonprofit agencies are affected by economic uncertainty in other ways. Individuals who have been or might be laid off are less inclined to spend money on cultural activities than more securely employed people. Nonprofits that rely on government aid are facing hard times. Lower revenue from property taxes, income taxes, user fees, and sales taxes are forcing state and local governments to reduce their budgets.
There is a greater emphasis on social enterprise activities as well. Nonprofits are expected to diversify their revenue streams and eliminate their reliance on public monies or foundation grants. The leadership of nonprofit organizations must understand, supervise, and implement finance strategies and social marketing. Tough financial times also provoke a greater scrutiny of performance outcomes and indicators of effectiveness.
There are also new corporate forms that recognize social businesses whose primary business is service and not profits. Low-profit limited liability corporations (L3Cs) and B corporations are recognized by some states and local government. They are run like a business and are profitable, but their primary aim is to provide a social benefit, often referred to as a double bottom-line. Social benefit is its primary mission. An L3C can accept foundation funds in the form of program-related investments (PRIs), mission-related investments, loans, and guarantees (Hrywna, 2009). A B corporation is a designation that a for-profit corporation can seek to signal it uses the power of business to create public benefit (Certified B Corporation, 2010; Environmental Leader, 2009). The intent of the new for-profit designation is to make it easier for socially oriented businesses to attract program-related investments from foundations and additional money from private investors (Loten, 2012; Pynes, 2011; Westaway, 2011).
The New Public Service
Graduates of schools of public policy and administration are likely to take their first jobs in the nonprofit sector and have shown an interest in working for the private sector as well. The nonprofit sector is attractive to graduates because they are motivated and believe they will find more challenging work and a greater opportunity to acquire new skills than in government service. More recently, increasing numbers of business students are seeking social purpose or responsibility positions at Fortune 500 companies or working at for-profit organizations that address economic development or energy issues. Sometimes they first go to work for for-profits to gain experience and then move to nonprofits (Glazer, 2012; Korn, 2011).
