Welcome to part 3 of my journey at Realise Performance
This week, I was informed that the cost of replacing an employee in senior management costs 200% of their annual salary. Therefore, if a senior manager were making $125,000 PA the cost of replacing them would be $250,000. This finding was also reported in the human resources benchmarking report. I thought that this figure was extremely high, so I conducted further research to see what these costs are attributed to.
Firstly, employee turnover costs more than most people realize, because there are a lot of indirect costs that tend to be overlooked, as they are hard to quantify (Work Place Info, 2016). Below I will discuss all the costs associated with replacing an employee.
Direct costs are costs that can be directly linked back to the cost of replacing a new employee. These include; remuneration, costs of advertising the vacancy, fees paid to recruitment agencies, fees paid to consultants for conducting tests, checking references, pre-employment medicals and termination payouts.
Indirect costs cannot be directly traced back to the employee and therefore are harder to quantify. These include; loss of productivity from other employees filling in for the vacant position, in house hiring costs, training induction costs, termination administration costs, loss of productivity in early stages of employment and loss of productivity in final stages of employment.
After understanding all these costs, I now completely agree and understand how the true cost of replacing an employee in senior management costs 200% of their annual salary.
During week 8 I conducted research into enterprise agreements.
Enterprise agreements are collective agreements made at an enterprise level between employers and employees about terms and conditions of employment.
Enterprise agreements can be tailored to meet the needs of particular enterprises.
An important thing to remember when creating an enterprise agreement is that it must leave an employee better off overall when compared to the relevant award or awards.
My task this week was to review all enterprise agreements made in 2016 and narrow the list down to agreements relating to aged care. Whilst completing this task I read through some different agreements. This enabled me to see and start to understand all the different parts of an enterprise agreement and how they interrelate. This task also showed me how enterprise agreements differ across industries.
Week 9 was my last week of interning so I focused on finishing my tasks.
One of these tasks was to destroy all the documents from a bullying case that Realise Performance was working on. Whilst doing so, I read through all the documentation and spoke to the other employees about it.
Once understanding the nature of the case, I realised that a number or preventative measures could have been implemented to identify and stop the bullying from happening. Below I will discuss the preventative measures, these include: creating effective policies and following up on them, management improvements, culture improvements and utilising training.
The first measure to prevent bullying is to create effective policies and to follow up on them. Policies help employees know what is expected of them with respect to standards of behavior and performance (Employment Law Handbook, 2016). By setting a standard of expected behavior, employees will know when they are behaving incorrectly. In the case of bullying, policies also help to adopt a consistent and clear response of what to when bullying occurs.
Whilst having policies are great, they are worthless when not implemented and monitored effectively. Rather then ‘ticking boxes’ management needs to effectively implement and monitor the success of their policies. Furthermore, they also need to foster a culture where employees feel comfortable to speak up in situations of bullying.
Finally, training helps reduce bullying. On-going training is fundamental if the policy is to be reflected in the day-to-day behavior of workers and the employer. Training offers employers the opportunity to show how something should be done rather then just telling employees how it should be done. Realise Performance offers a number of different training packages that can help to effectively address issues relating to bullying such as: Bullying and Discrimination Training, Change: Making a lasting impact training, Communication: Getting your message across, Effective Leadership Training, Performance Appraisal Training, Supervision Training, Teamwork Training and Work, Health and Safety Training.
In Summary, my internship at Realise Performance has been excellent. Each week has presented itself with new tasks, topics and challenges. I have gained invaluable experience and I now understand human resources from a practical perspective.