Human Resources Basics
© Ronald J. Rakowski, SPHR, CELS
Along with the growing industrialization of America during and following World War I, workers saw the "need" for union representation to help them improve their pay, benefits, and working conditions. Established in 1886 by Samuel Gompers, the American Federation of Labor (AFL) successfully organized workers at many industrial companies and its success continued following the war. Faced with dealing with organized workers and the unions that represented them, companies began establishing industrial relations departments to handle labor issues. In many, maybe most, cases, a company's industrial relations department was completely separate from its personnel function, although both functions dealt with employment issues.
As the federal and state governments began passing more and more laws that affected working people and the organizations that employed them, the two functions grew nearer. In some cases, the industrial relations people came out on top and in other cases the personnel people came out on top. But many people-issue managers struggled with the personnel/industrial relations designations, so in the 1970's a new title emerged (personnel and industrial relations), and those same managers started referring to themselves as PAIR managers/executives. Fortunately, this designation disappeared with the emergence of HUMAN RESOURCES (HR) in the early- to mid-1980's.
Recognizing that the human element in the workplace should be considered a resource, along with natural, capital, and financial resources, rather than just another cost of doing business, a significant number of employers began to place the personnel function (staffing, salaried compensation and benefits, training, compliance with workplace laws, etc.) and the industrial relations function (labor relations) under the broad responsibility of a human resources department, typically headed by a corporate vice president. Following this trend, the world's largest association of people involved in workforce management changed its name from the American Society for Personnel Administration (ASPA) to the Society for Human Resource Management (SHRM) in 1986.
Along with the consolidation of human resources responsibilities and the increased presence of the overall function in corporate American, organizations began challenging HR professionals to begin connecting their activities to the organization's bottom line. Some were up to the challenge, and some were not. Those up to the challenge discovered that, as never before, they were being invited into the "back room" to participate in arriving at business decisions relative to issues that affected the entire organization, not just those that were people-related. The many who were not up to the challenge soon fell by the wayside.
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