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Human Resources Management : Individual Assignment

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Human Resources Management: Individual Assignment – Topic 2 Introduction An employee may be happy with his job and the challenge it offers him but you wouldn’t want him to feel that he’s not valued or rewarded enough for his actions because one day, that employee may be your top contributor. The next day he could be a top contributor for some other company. If that wasn’t bad enough, that ‘some other company’ may very well turn out to the employer’s stiff competitor. Employees have that choice. But employers don’t. This is why an employer’s psychological contract with his employees is of utmost importance. It essentially refers to the mutual expectations they have of one another in the business relationship and how these expectations …show more content…

(Businessballs, n.a.) But before reviewing the reward systems affecting the contract, we must know what motivates an employee and what an employer must aim to provide in order to maintain a mutually beneficial psychological contract. Maslow explains this through his ‘Hierarchy of Needs’ model.
The model shows that once the physiological needs such as the basic items required for survival such as food, water and shelter and the safety needs such as security of employment, environment and resources have been established, the employee begins to feel the need to feel like a part of the workplace i.e. belongingness and the need to be recognized and rewarded for his work. (Learning-Theories.com, n.a.) This is where a company brings in its reward systems so as to help the employee on his path to self-actualization i.e. maximizing his potential as a human being.
Renowned psychologist Frederick Hertzberg devised the Motivation-Hygiene theory which differentiates between intrinsic and extrinsic factors of motivation. He states that factors such as company policies, supervision, relationship with supervisor and peers, work conditions, salary, status and security fall under Hygiene (Riley, 2005). Hertzberg believed these factors are extrinsic in nature and the absence of these factors will cause dissatisfaction among the employees but their presence won’t improve satisfaction (Yusoff, Kian, & Idris, 2013). According to him, achievement, recognition,

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