Topic: Motivation - Theories

There are a number of different views as to what motivates workers. The most commonly held views or
theories are discussed below and have been developed over the last 100 years or so. Unfortunately
these theories do not all reach the same conclusions!

Taylor

Frederick Winslow Taylor (1856 – 1917) put forward the idea that workers are motivated mainly by pay.
His Theory of Scientific Management argued the following:

Workers do not naturally enjoy work and so need close supervision and control

Therefore managers should break down production into a series of small tasks

Workers should then be given appropriate training and tools so they can work as efficiently as possible
on one set task.

Workers are then paid according to the number of items they produce in a set period of time- piece-rate
pay.

As a result workers are encouraged to work hard and maximise their productivity.

Taylor’s methods were widely adopted as businesses saw the benefits of increased productivity levels
and lower unit costs. The most notably advocate was Henry Ford who used them to design the first ever
production line, making Ford cars. This was the start of the era of mass production.

Taylor’s approach has close links with the concept of an autocratic management style (managers take
all the decisions and simply give orders to those below them) and Macgregor’s Theory X approach to
workers (workers are viewed as lazy and wish to avoid responsibility).

However workers soon came to dislike Taylor’s approach as they were only given boring, repetitive tasks
to carry out and were being treated little better than human machines. Firms could also afford to lay
off workers as productivity levels increased. This led to an increase in strikes and other forms of
industrial action by dis-satisfied workers.

Mayo

Elton Mayo (1880 – 1949) believed that workers are not just concerned with money but could be better
motivated by having their social needs met whilst at work (something that Taylor ignored). He
introduced the Human Relation School of thought, which focused on managers taking more of an
interest in the workers, treating them as people who have worthwhile opinions and realising that
workers enjoy interacting together.

Mayo conducted a series of experiments at the Hawthorne factory of the Western Electric Company in
Chicago
He isolated two groups of women workers and studied the effect on their productivity levels of changing
factors such as lighting and working conditions.

He expected to see productivity levels decline as lighting or other conditions became progressively
worse

What he actually discovered surprised him: whatever the change in lighting or working conditions, the
productivity levels of the workers improved or remained the same.

From this Mayo concluded that workers are best motivated by:

Better communication between managers and workers ( Hawthorne workers were consulted over the
experiments and also had the opportunity to give feedback)

Greater manager involvement in employees working lives ( Hawthorne workers responded to the
increased level of attention they were receiving)

Working in groups or teams. ( Hawthorne workers did not previously regularly work in teams)

In practice therefore businesses should re-organise production to encourage greater use of team working
and introduce personnel departments to encourage greater manager involvement in looking after
employees’ interests. His theory most closely fits in with a paternalistic style of management.

Maslow

Abraham Maslow (1908 – 1970) along with Frederick Herzberg (1923-) introduced the Neo-Human
Relations School in the 1950’s, which focused on the psychological needs of employees. Maslow put
forward a theory that there are five levels of human needs which employees need to have fulfilled at
work.

All of the needs are structured into a hierarchy (see below) and only once a lower level of need has
been fully met, would a worker be motivated by the opportunity of having the next need up in the
hierarchy satisfied. For example a person who is dying of hunger will be motivated to achieve a basic
wage in order to buy food before worrying about having a secure job contract or the respect of others.

A business should therefore offer different incentives to workers in order to help them fulfill each need
in turn and progress up the hierarchy (see below). Managers should also recognise that workers are not
all motivated in the same way and do not all move up the hierarchy at the same pace. They may
therefore have to offer a slightly different set of incentives from worker to worker.
Herzberg

Frederick Herzberg (1923-) had close links with Maslow and believed in a two-factor theory of
motivation. He argued that there were certain factors that a business could introduce that would
directly motivate employees to work harder (Motivators). However there were also factors that would
de-motivate an employee if not present but would not in themselves actually motivate employees to
work harder (Hygienefactors)

Motivators are more concerned with the actual job itself. For instance how interesting the work is and
how much opportunity it gives for extra responsibility, recognition and promotion. Hygiene factors are
factors which ‘surround the job’ rather than the job itself. For example a worker will only turn up to
work if a business has provided a reasonable level of pay and safe working conditions but these factors
will not make him work harder at his job once he is there. Importantly Herzberg viewed pay as a
hygiene factor which is in direct contrast to Taylor who viewed pay, and piece-rate in particular

Herzberg believed that businesses should motivate employees by adopting a democratic approach to
management and by improving the nature and content of the actual job through certain methods. Some
of the methods managers could use to achieve this are:

Job enlargement – workers being given a greater variety of tasks to perform (not necessarily more
challenging) which should make the work more interesting.

Job enrichment - involves workers being given a wider range of more complex, interesting and
challenging tasks surrounding a complete unit of work. This should give a greater sense of achievement.

Empowerment means delegating more power to employees to make their own decisions over areas of
their working life.
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Meaning-:

Statutory means "of or related to statutes," or what we normally call laws or

regulations. Compliance just means to comply with or adhere to. So statutory
compliance means you are following the laws on a given issue.

The term is most often used with organizations, who must

follow lots of regulations.

When they forget or refuse to follow some of those regulations, they are out of
statutory compliance. A company that follows all the rules, is in statutory
compliance.

Purpose-:

Safeguarding the employees and the enterprise from untoward risks by managing
and consulting on issues such as retirement benefits and Taxation
ESI

Provident Fund
Profession Tax

Gratuity
The Minimum Wages Act
The Maternity Benefit Act
The Payment Of Bonus Act
The Payment Of Wages Act
Was originally applicable to non-seasonal factories using power and
employing 20 or more persons; but it is now applicable to non-seasonal power
using factories employing 10 or more persons and non-power using factories
employing 20 or more persons

All the employees in the factories or establishments to which the Act applies

shall be insured under this Act

The contribution comprise of employer’s contribution and employee’s

contribution at a specified rate

Contribution rate :

1.75% - employees

4.75% -employers

The ceiling 10,000/- gross salary. After reaching the ceiling one will be

exempted. (with effect from 1.10.2006)

Employer is liable to contribute & deduct specified rate of amount and submit

it to the Corporation within 21 days.

Two contribution periods each of six months:

1st April to 30th Sept
1st Oct. to 31st March

Two corresponding benefit periods of six months :

1st January to 30th June

1st July to 31st December

PF and Miscellaneous Provisions Act, provides for compulsory
contributory fund for the future of an employee after his retirement or
for his dependents in case of his early death

It extends to the whole of India except the State of J&K

Every factory engaged in any industry specified in Schedule 1 in which

20 or more persons are employed

Every other establishment employing 20 or more persons or class of such

establishments which the Central Govt. may notify and any other
establishment so notified by the Central Government even if employing
less than 20 persons

PF is contributed from both the sides @12% of the basic salary.

Contribution for the purpose of Employees' pension Scheme is
8.33% of (12% of employers contribution towards PF) or Rs.540/- which
ever is less, will be transferred to Employees’ pension scheme and the
balance amount will go towards Employee PF.
Professional tax or employment tax is a state-based tax. It is allowed as a

deduction from the gross income before computing the tax.

Duration of deduction is half year-
1st day of April to 30th September
1st day of October to the 31stMarch of a year.

PT is deducted slab wise-

1 to 2500-nil
2500 to 3500 -Rs 60
3501 to 5000 - Rs 120
5001 to 10000- Rs 175

and above 10000 Rs 200 per month except Rs 300 in the month of february

Each and every employee receiving pay from the revenue of the Central

Government or any State Government is entitled to pay profession tax

Any organization whether incorporated or not, which is owned or

controlled by the Central Government or any State Government is eligible
to pay PT
Gratuity is an amount given to employees by employer
when they leave the job after completing five years or
minimum 240 days per year or after retirement. The number
of year may differ from company to company

Gratuity is payable under the payment of wages act.

Gratuity shall be payable to an employee on the termination

of his employment after he has rendered continuous service

for not less than five years.

(a) on his superannuation, or
(b) on his retirement or resignation, or
(c) on his death or disablement due to accident or disease

Gratuity is calculated as Basic + DA divided by 26 * No of

years of service *15.

This act provides for fixing minimum rates of wages.
Wages shall mean all remuneration payable to an employed person on the
fulfillment of

the contract employment and includes HRA.

It Includes

(i) a basic rate of wages and special allowance call the cost of living allowance
(ii) a basic rate with or without cost of living allowance plus any concession on the
supply of essential commodities.

It excludes

(i) The value of rent free accommodation, supply of light, water, medical.....
(ii) Contributions paid by the employer towards the PF or any scheme of social
insurance
(iii) Travelling allowance / Travelling concession
(iv) Gratuity

The appropriate government may fix-:

A minimum rate of wages for time work ("a minimum time rate").
A minimum rates of wages for piece work ("a minimum piece rate").
A minimum rate of wages on a time work basis ("a guaranteed time rate")
A minimum rate of overtime work done (“a overtime rate")
Penalty:-

The inspectorate staff of the Labour Department takes action on complaints

received

from workmen/Unions.

The penalty for violation of is fine of R.500/- or imprisonment upto a period of six
months or both.

If a worker gets less payment, he can also file a claim before the Competent
Authority appointed under the Act, which are Deputy Labour Commissioners for the
respective districts.

The authority can impose penalty up to 10 times the difference in minimum wages
that

was due and paid

To regulate employment of women for certain periods before and after

child birth and to provide for maternity benefit.

Payment of maternity benefit shall apply to women workers to whom

ESI Act does not apply.

The Act applies to all establishments in which ten or more people are

employed.

The maternity benefit shall be at the rate of average daily wage for the
period of actual absence. The maximum period of entitlement shall be
12 weeks of which not less than 6 weeks shall precede the expected
date of delivery.

Maternity benefit shall be payable to employee or any other persons as

per the nomination.

The Amount of benefit upto the period of expected delivery shall be paid in
advance. The balance due for the subsequent period shall be paid within 48 hours
from delivery of child.
The Payment of Bonus Act imposes statutory liability upon the
employers of every establishment covered under the Act to pay bonus
to their employees.

It provides for payment of minimum and maximum bonus and linking

the payment of bonus with the production and productivity.

The Act applies to every factory where 10 or more workers are working
and every other establishment in which 20 or more persons are
employed, on any day during an accounting year

Every employee receiving salary or wages upto RS. 3,500 p.m. and
engaged in any kind of work whether skilled, unskilled, managerial,
supervisory etc. is entitled to bonus for every accounting year if he has
worked for at least 30 working days in that year

Penalty

The punishment provided for contravention of any provisions of the

Act or any rule made there under is imprisonment for a term, which
may extend for 6 months or with fine, which may extend to Rs. 1000/- or
with both.
It is a central legislation which applies to the persons employed in the

factories and to persons employed in industrial or other establishments

This Act does not apply on workers whose wages payable in respect of

a wage period average Rs. 1600/- a month or more.

This Act has been enacted with the intention of ensuring timely

payment of wages to the workers without unauthorized deductions.

The salary in factories/establishments employing less than 1000

workers is required to be paid by 7th of every month and in other cases
by 10th day of every month.

A worker, who either has not been paid wages in time or an

unauthorized deductions have been made from his/her wages, can file a
Claim either directly or through a Trade Union or through an Inspector
under this Act.
The present day legal climate is one of
uncertainty and confusion. In most cases, a
law comes to light only after its
contravention, resulting in severe penalties.
Statutory Compliances is a must in keeping
you away from the long arm of the law!

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Statutory Compliances For HR

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Please find attachment of Statutory Compliances included Meaning, Purpose, PF,ESI,

Minimum Wages, BONUS,Gratituty, Paymt. of Wages

statutory complaince

statutary hr

comes

organization

law statutory

compliances like

compulsory statutory

(more tags)

statutory complaince

statutary hr

comes

organization
law statutory

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Alice Thomasleft a comment

such a nice informative article ! can i get a copy of this to my Mail !

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very informative would love to get these kinda ppts on my mail if its possible

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manu_gupta_3679

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this is a very beautiful article about HR related and the website is also very fruitful.

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