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Study Notes: People ManagementFlexible working - annual hours contracts What is an annual hours contract? An annual hours contract is a system whereby the period of time within which full time employees must work is defined over a whole year. For example, an average 40-hour week becomes 1,880 annual hours, assuming five weeks of holiday entitlement (37 weeks x 40 hours per week). This is the total hours an employee must work each year under the contract. Once the annual hours of work have been agreed these hours are usually distributed in a schedule. Some of the hours may be held in reserve to be used when the employer and employee agree, or they may all be used within the schedule. It will also be necessary allow for public holidays and overtime. Annual hours can be applied to all employees, including day workers and white collar employees, but in practice the system is often restricted to shift workers. Why might a business introduce an annual hours system? • To help reduce the working week (often an objective of trade unions) • To reduce, abolish or control overtime • To help the business cope with seasonal variations and/or peaks and troughs in demand • To maximise productivity • To help introduce technological change • To harmonise terms and conditions of employment Advantages of an Annual Hours System - For employers annual hours can provide greater employee flexibility, reduce overtime and maximise productivity and efficiency - Benefits for employees include improved basic pay and progress towards salaried status Possible Disadvantages - Most annual hours agreements specify that employees can
be asked to work extra
hours at short notice which may be beneficial to employers
but can reduce the freedom of employees to plan their leisure
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Related Study Notes HRM Strategy Organisational Structure Motivation at work Recruitment & Training Workforce planning Communication
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HRM Strategy HRM introduction HRM objectives HRM influences Hard & Soft HRM Organisational Structure Org charts Delayering Span of control Centralisation & decentralisation Matrix structures Motivation at work What is motivation? Theory - Maslow Theory - Herzberg Theory - Taylor Theory - McGregor Financial motivation Pay Package Time rate Piece rate Commission Performance pay Share options Job rotation Job enlargement Delegation & empowerment Recruitment & Training Recruitment intro Internal / external Job descriptions Interviews Job analysis Job advertising Person specification Training - intro Induction training On-the-job training Off-the-job training Workforce planning Workforce planning Flexible working Benefits & issues Labour supply Workforce roles & workload Annual hours Job sharing Temporary staff Teleworking Flexible hours Communication Overview Barriers Benefits Employee Representation
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