Human resource management (HRM) is the organizational function that encompasses every aspect of the “human” in a business, including hiring, training, motivating, evaluating, and compensating personnel.

Staff planning involves determining how many employees a company needs. A workforce profile is compiled as a form of “personnel inventory” and includes information about each employee. The future demand for employees is determined by a process called forecasting.

Recruitment is the process of finding, screening, and selecting people for a job.

Hiring begins by narrowing down the number of applicants who are qualified for a job. They are then interviewed by human resources personnel and the job’s manager and sometimes the other people he or she supervises. Often a firm will make a conditional offer to the candidate selected, who then must first pass background and reference checks and sometimes medical and physical tests before officially being hired.

Orientation integrates new employees into an organization so they become productive faster, feel part of the organization, and do not quit shortly after being hired. Other forms of training include on-the-job training, apprentice training programs, and simulation training.

Management development programs prepare management trainees to become managers within an organization by having them participate in on-the-job training programs, such as job rotation, coaching/understudy programs, action learning, and mentoring.

Off-the-job training and development require the employee to participate in outside seminars, university-conducted programs, and corporate universities.

A performance appraisal is a formal evaluation of an employee’s performance. Providing feedback and suggestions to employees for improvement, coaching and encouraging them, and helping them set goals are parts of appraisals. They are useful when done properly, but many managers avoid performance appraisals because they do not feel comfortable critiquing employees and do not see all aspects of their performance. A 360 performance appraisal in which input is solicited from an employee’s coworkers, customers, and subordinates and incorporated into the appraisal, can help in this regard.

Performance management is an alternative to performance appraisals. It approaches employee evaluations as ongoing and systematic.

Compensation, or payment for work performed, consists of financial and nonfinancial payments.

Salaries and hourly wages, bonuses, commissions, and retirement pension plans constitute financial ­compensation.

Defined benefit plans specify the amount of retirement benefits employees will receive, and defined contribution plans identify the maximum contribution employees can make to their retirement plans. 401(k) plans allow employees to contribute pretax dollars to their retirement plans.

Noncash employee benefits come in many forms, including health and disability insurance, vacation and sick pay, and retirement plans. Some benefits are mandated by law. Others are provided voluntarily by ­employers.

Work/life benefits, such as gym memberships, are important for those employees who are trying to balance busy lives both in and out of work.

Alternative scheduling arrangements enable employees to have more flexibility in their lives. Flextime, job sharing, permanent part-time jobs, telecommuting, and compressed workweeks are alternative scheduling methods.

Employees increase their level of responsibility through promotions—taking on a job that has more responsibility and greater status and pay in a company or a department.

Termination is when companies permanently lay off workers as a result of poor performance or a discontinued use for their services. Downsizing and restructuring, outsourcing and offshoring, pressures of global competition, and increased uses of technology are reasons companies look to reduce the number of employees through termination.

Retirement occurs when employees decide to stop working on a full-time basis or stop working altogether. Financial security, staying active and engaged, and learning something new are reasons seniors cite for deferring retirement.

The workforce today consists of employees from many different cultures and religions, which can lead to challenges in helping employees understand one another.

More women are now in the workforce than in decades past, but few are reaching executive management levels. Sexism, salary inequity, and sexual harassment remain prominent issues.

The workforce is getting older as more baby boomers work beyond typical retirement age. An aging workforce increases a firm’s health care costs but also can increase a firm’s productivity and decrease its training costs.

A diverse workforce has proven to be more creative and innovative than a nondiverse workforce. Diversity keeps companies competitive by helping them develop products and services tailored to diverse customers.

A labor union is a legally recognized group organized to protect the interests of workers. Labor unions ­typically negotiate various employment terms, such as the salaries, health benefits, and work hours of their members.

Representatives of the labor union form a bargaining unit that negotiates with an employer. The negotiations are referred to as collective bargaining.

If satisfactory terms cannot be agreed on by both sides, mediation is used. A neutral third party assists both sides and generates a proposal that addresses each party’s interests.

In the arbitration process, a third party settles the dispute after hearing all of the issues.

If negotiations break down, unions and their supporters may choose to boycott a company (not do business with it).

As a last resort, union members may vote to go on strike and agree to stop working altogether.

As the business community continues to expand globally, unions will need to increase their numbers by allying themselves with international workers and workers and immigrant workers.