HRM 2200 Lecture Notes - Lecture 12: Headcount, Bombardier Talent 2, Job Performance
Document Summary
Labour costs = employment (all employment) x average pay x unit benefits. Controlling employment: number of employees and hours (reduce employees to control costs) Organizations reduce headcount through layoffs or exit incentives. However, regulations make cuts difficult (designed to make cuts difficulties + union agreements add costs when you reduce the workforce and outsource) May harm employee relations, increase turnover (survivor effect) May harm future business if cut too deep. Increase unemployment insurance tax rates and administrative costs and disrupts workflow. Firms examine overtime hours versus hiring more employees. The four factors in the labor cost model are not independent: number of employees (fastest way to reduce your costs, hour worked, cash compensation (mainly because of variable pay you take that out, benefit costs. Plan changes: reduction of benefits provided. Controlling health care benefits: co-ay, preferred providers, flex plans. Three distinct but related concepts and their measures.
