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PROCEDURAL and PRACTICES OF HUMAN RESOURCE MANAGEMENT IN RELIANCE FINANCE LIMITED BJ Bhawan, Pradarshani Marg, Kathmandu, Nepal

MASTERS THESIS Prepared by Smriti Sharma

ABSTRACT
In todays rapidly changing business environment, organizations have to respond quickly to requirements for people. The Financial market has been witnessing growth which is manifold for last few years. Many private players have entered the economy thereby increasing the level of competition. In the competitive scenario it has become a challenge for each company to adopt practices that would help the organization stand out in the market. The competitiveness of a company of an organization is measured through the quality of products and services offered to customers that are unique from others. Thus the best services offered to the consumers are result of the genius brains working behind them. Human Resource Management in this regard has become an important function in any organization. All practices of marketing and finances can be easily emulated but the capability, the skills and talent of a person cannot be emulated. Hence, it is important to have a well-defined recruitment policy in place, which can be executed effectively to get the best fits for the vacant positions. Selecting the wrong candidate or rejecting the right candidate could turn out to be costly mistakes for the organization. Therefore a recruitment practice in an organization must be effective and efficient in attracting the best manpower. During the study of Management, I have chosen Human Resource Management as a major subject on which I had the interest to investigate as such I have presented my thesis on Human Resource Management Practices within my organization. For my research I have chosen my own Organization and have interviewed few persons to analyze the Human Resource Management Practices. The most important interview questions in my study are, Has the trainings provided become benefit for both the person and the organization. In what ways can we improve the work efficiency. Is it important for you to get rewards for your performance? What factors are motivating to you? I have found answers to my questions, there are many ways to we can improve and enhance HRM I have also reached the conclusion that people always strive for more.

Acknowledgement
First of all I would like to state that writing this thesis has made me grow as individuals. Moreover, I have gained useful knowledge regarding Practices of Human Resource Management in Reliance Finance Limited and management in total. When conducting the interviews I also sensed a connection with working life. I would like to thanks friends and family, who have given us their support during this time, To my tutor Dr. Satish Kumar Ojha, who have given me feed back and ideas during my research. Purbanchal University HOPE Campus Smriti Sharma

Table of contents

Chapter I

Procedural and Practices of Human Resource Management


INTRODUCTION 1.1 Background of the Study Banking institutions have been providing very important service to the general people. Financial sector has evolved as a dominant sector in Nepalese economy. There are altogether 237 financial institutions employing more than 20,000 people and managing approximately Rs 502 billion worth of assets. Return on these assets (ROA) is very negligible, figuring 2.59 percent of the assets. The reasons behind such disappointing ROA is the poor quality of loan coupled with lack of credit skills assessment and undifferentiated products offered by the financial institutions. There is a wide array of products about which the banking community of Nepal lacks adequate knowledge and technology for their use and appropriate corporate governance. In this context, Nepals our financial market needs appropriate measures for improving knowledge level of human resources, use of technology and improving corporate governance. In any economy, the importance of financial sector in general and banking sector in particular cannot be undermined. Banking sector plays a pivotal role in the overall development of an economy. The economic reforms initiated by the Government eighteen years ago have changed the landscape of several sectors of the Nepalese economy. The Nepalese banking sector is no exception. This sector has been going through major changes as a consequence of economic reforms. The changes affect the ownership pattern of banks, regulatory aspects, availability of funds, the cost of funds as well as opportunities to earn, range of services (fee-based and fund based), and management of priority sector lending. As a consequence of liberalization in interest rates and cutthroat competition, banks are operating in reduced spread. The economic reforms have also generated new and powerful customers (Nepalese middle class) and new mix of players (public sector units, private banks, and foreign banks). The emerging competition has generated new expectations from the existing and the new customers. There still lies an urgent need to introduce new products. Existing products need to be delivered in an innovative and cost-effective way by taking full advantage of emerging technologies. Currently, the trend is to increase the number of financial institutions and not the quality of financial services being delivered. With 25 commercial banks already up and running, 7 new commercial banks are waiting for green signal from Nepal Rastra Bank. It is pretty evident that we have been seeing the growth

in width of Nepalese financial sector, however, the depth and specialization severely lacks quality. 1.2 Scenario of Nepalese Financial Sector Although financial institutions have proliferated, the Nepalese people have not yet reaped the potential gains of the government's efforts to liberalize and reform the financial sector. There are four main reasons for this: excessive government involvement in the sector, a weak central bank, a poor banking environment, and a lack of adequate banking services for the poor. The financial sector also faces other issues that impede its development such as a poorly functioning credit bureau, risky finance companies, a ceiling on foreign ownership, limited financial services, poor accounting standards, and limited use of information technology. In November 2000 the government issued a paper outlining its proposed financial sector reform program for the medium term, one which touches on all the major issues and provides sufficient basis for undertaking far-reaching reforms. While the government has committed to withdrawing from the sector as owner and operator, this study makes recommendations for making the government's strategy fully implementable. Recommendations center on five important principles: Withdrawing the government from ownership of financial institutions. Significantly strengthening the central bank to make it a fully professional institution. Restructuring the Asian Development Bank of Nepal and closing the Nepal Industrial Development Corporation. And creating an appropriate environment for establishing a sound financial sector.

Chapter II
Reliance Finance Limited "Redefinition

of Service"

2.1 Introduction Reliance Finance Limited is incorporated in the 2066 as 84th Finance Company under the Bank and Financial Institution Act 2063 and the Company Act, 2063. The Company is licensed by the Central Bank of Nepal (Nepal Rastra Bank) to undertake financial services in the country. The Company started its operation (from 15th Aswin 2066) after having license from Nepal Rastra Bank, the Central Bank of Nepal. The registered office of the Company is situated at Kathmandu Metropolitan City, Ward No. 31, B.J. Bhawan, at Pradarsani Marg, Kathmandu in front of Padmodaya School. Reliance Finance Limited is managed by the team of young and dynamic professional. In-depth knowledge of the management team about the financial sector and customer friendly environment are the strength of the Company. The Company is providing the broad range of financial services to its customer in a most convenient way and promptly to its customers in a highly automated information technology and communication systems. 2.2 Objective The main objective of the Company is to provide quality and reliable customer services to the public through the application of the modern information and communication service. 2.3 Vision To become a leading financial institution within 5 years. 2.4 Mission To enable the company to achieve its goal through the continuous development of innovative financial product, responding customers needs in a timely and professional manner, continuously promoting best business practices, creating a fulfilling workplace based on mutual respect, encouraging team and individual achievement, ceaselessly reexamining values and ideas to ensure that are in tune with the Company's goal. 2.5 Strategy: Reliance Finance Limited is committed to reach out to more and more customers and fulfill their financial requirements. The focus of the company will be on non-banking people and un-regulated sector like cooperatives and strong network base of the promoters.

2.6 Structure: Reliance Finance Limited will have basically three-tier management composition viz. the Board of Directors, MD/CEO and the Team of Staff. Our confidence is in our professional team, and in turn our customers have utmost trust on us. 2.7 Our People: Reliance Finance Limited has amongst its people in the best and professionals for the finance industry. Our department heads bring with them an enormous expertise and experience in banking. 2.8 Capital Base Reliance Finance Limited is a Public Limited Company with an authorized capital of 250 Million. Issued and Paid up Capital is NPR 200 million out of which NPR140 million is invested by the promoters and NPR 60 million by the General Public. 2.9 Background of Directors Mr. Kush Prasad Mally Mr. Mally is the Chairman of the company. He is also the Chairperson of Mally Merchant & Investment Company and Mally Brothers Pvt. Ltd. He has already served in various positions at the FNCCI Butwal and Past President. Mr. Mally's profile of corporate experience is long and illustrious. Mr. Anil Shrestha Mr. Shrestha has long experience of the financial sector. He served almost 13-14 years in the United Finance Limited since the inception. He started career as a Junior Assistant and promoted to Chief Manager before leaving the job. He worked almost all departments starting from Teller, Account, Deposit, Loan, Credit Administration, Administration, Marketing, etc. Mr. Chin Kaji Shrestha Mr. Shrestha is a very well known personality of social and political sector of Nepal. He has serving the nation in various ways as a social worker and politician. He has already served as a former Deputy Minister of Finance and elected Member of the Parliament. Mr. Mukunda Raj Panday Mr. Panday is the past President of Nava Kantipur Multipurpose Pvt. Ltd., for decade long period from 2054 B.S. He has very sound knowledge in Cooperative services. Besides this he has keen interest in involving in various social and Cooperative activities in local area that uplift the economic level of community. Mr. Sur Krishna Vaidya

Mr. Vaidya is well known personality in Kavre for his dedication and devotion for community development. He is one of the pioneer transport businessmen in Kavre District. Currently he is involving in FNCCI Kavre as Executive Member since 2002 A D, as Chairman in Kavre Minibus Service Committee since 1998 A D, and Executive Member in Nepal Family Planning Association since 2004 A D. Mr. Tilak Bahadur Chand Mr. Chand is young and dynamic businessman of Far Western Regional Development, Kanchanpur. He was member of FNCCI Kanchanpur for Finance Committee since 2058 to 2064. Presently he is the Chairman of Saubhagya Shree International Pvt. Ltd and Executive Member of Anamnagar Development Committee and Milan Vidya Mandir Secondary School. 2.10 Profile of Promoters The company has wide and diversified range of ownership, including leading Nepalese entrepreneurs, businessmen, industrialists, bankers, social workers, IT professionals, academicians etc. 2.11Organizational Structure Reliance Finance Limited will have basically three-tier management composition viz. the Board of Directors, MD/CEO and the Team of Staff. With the expansion of different branches, a Branch Manager will be appointed as the head of operation in the respective Branches. Adequate number of supporting staff of different hierarchy will be recruited. Our People Reliance Finance Limited has amongst its people in the best and professionals for the finance industry. Our department heads bring with them an enormous expertise and experience in banking. Our confidence is in our professional team, and in turn our customers have utmost trust on us. 2.12 Technology & Management Information System Reliance Finance Limited have modern computerized MIS. The entire day-to-day operations such as maintain records of loan, deposit accounts, management information reports and various weekly, monthly, half yearly, yearly reports as prescribed by NRB will be generated by the computer system. Customer base Reliance Finance Limited is committed to reach out to more and more customers and fulfill their financial requirements. The focus of the company will be on non-banking people and un-regulated sector like cooperatives and strong network base of the promoters.

2.13 Scope and Activities Being NRB "C' Class Financial Institution -Finance Company, the major activities of Reliance Finance Limited are mainly concentrated on two areas: Deposit and Lending. 2.14 Deposits Activities Reliance Finance Limited has a wide range of deposits products with highly competitive rates. The various deposit schemes include Saving Account with daily balance and Fixed 2.15 Deposits for varying periods. The fixed deposits accepted at Reliance Finance Limited are of two types: Maturity Fixed Deposit In this scheme interest is calculated on simple interest rate for the total period of maturity and interest is payable on maturity. Quarterly Fixed Deposit In this scheme interest is calculated on quarterly basis and paid/transferred to saving account of the depositor. The period of fixed deposits shall vary from 3 months to 5 years and above. 2.16 Saving Deposits Deposits kept by the depositor with the company for an uncertain period with an intention ot withdraw the money at his desire are called saving deposits. Saving deposits can be withdrawn on demand at any point of time. They carry a relatively lesser interest rate due to uncommitted period of maintaining such deposits. The saving deposits accepted at Reliance Finance Limited as follows: Normal Saving Deposit Special Saving Deposit Corporate Saving Deposit Recurring Saving Deposit Borrower Saving Deposit 2.17 Lending Activities The credits activities of RFL mainly revolve around the major sectors are Hire Purchase, Housing and Term Loan. In the Hire Purchase sector, the organization is into the financing Two-wheeler, Four-wheeler to individual or institutional -personal & commercial, Machinery & Equipment and Consumer Durables like Home Appliances and Computer. Similarly, Housing Loan mainly encompasses loans provided for Personal & Corporate land & building purchase, renovation and construction. The third major sector of financing is Business/SME Loan which includes investment in Business and Trade to fulfill working capital requirement and supplement entrepreneur's investment to further expanding the existing business. Also, focus on Personal and Consumer Durable Loan as well as non-funded facilities like Bank Guarantee, Bid Bond, Performance Bond, etc.

2.18 Consumer Financing Product- An Overview Four Wheeler Two Wheeler Home Loan Consumer Durable Loan Education Loan Computer/Laptop Loan Personal Loan SME Loan Heavy Equipment Loan Bank Guarantee

2.19 Pricing of Product Pricing plays crucial role of product marketing and to achieve the company's goal. So, the prices of the product should be competitive and alluring in the market. Judgment Criteria The loan proposals are judged on the basis of the RFL's policy formulated by the Board and it is ensured that the clients who meet these criteria receive the desired loans: The client should be a Nepali citizen The client should be resident of Kathmandu Valley The person should be of sound background and reputation. He should have enough Uncommitted Monthly Income to cover installment amount He should be able to produce enough evidence to support his usage and value of loan He should be able to provide sufficient security as per our collateral policy. There should be a guarantor and should specify the relation with the guarantor. The guarantor should be equal status of the client. Loan Disbursement Activities Pre disbursement Activities Post disbursement Activities Comparative Pricing of Deposit & Lending of Competitors 2.20 Background of Financial Institution in Nepal In the process of economic liberalization, the government introduced Finance Company Act 2042 to attain economic growth in Nepal by increasing non-banking activities. After seven years from the Act in force, Nepal Housing and Development Company established from government side to promote the non-banking activities. Soon after this,

Nepal Finance and Saving Company came in the operation as first finance company for the private sector. 2.21 Types of Financial Institution Commercial Banks There are 26 commercial banks in total and almost all of these commercial banks have concentrated their activities in Kathmandu and other major cities. As per the Nepal Rastra Bank Guidelines, banks can perform a wide range of functions like deposit collection, mobilization of deposit in various projects, investments in government securities and so on. The sources of income for these banks and many varied. Remittance is one such area which has helped the banks to earn additional income. Development Banks The development banks also perform the functions similar to that of commercial banks. As per the NRB Guidelines, a development bank can perform all the activities prescribed for commercial banks but the focus of these banks should be mainly on launching development projects. Finance Companies In contrast to the commercial banks and development banks, the 78 finance companies operating in and outside Kathmandu Valley have a narrow scope mainly because their activities are confined to deposit collection and lending. However, the bank have occupied a bigger chunk of the deposit market and have also attracted the cream clients for lending making it even more difficult for the finance company to sustain. Micro Saving & Credit Cooperatives 2.22 Marketing : Marketing is the process of planning, promotion and distribution of ideas, product and service to create, exchange that satisfy individual and organizational objectives. To the general public, marketing is selling through advertisement and sale promotion. However, selling and sales promotions are only parts of marketing. Marketing success belongs to those who can create, promote and deliver products that customer are able and will to buy. 2.23 Business Growth Strategies of RFL The Reliance Finance Limited has the following business strategy and course of action plan to attain its goal. 2.23.1 Promotion: The finance will disseminate all information as possible and allowed by the law to the general public in terms of advertisements or press bulletin or newsletters. Advertisements highlighting deposits and lending rates and other allied benefits offered by the finance

will made public by available means by which the general public and prospective customer seeking financial service will be well informed and aware of the existence of the Finance. It will also keep on reminding the finance's activities and builds up public image that is must for the growth of a new finance. 2.23.2 Personal contacts: The employee of the finance shall keep personal contacts to convince and brief about the financial products and services to the individuals and corporate. In such a competitive edge, it helps tapping the clients for selling the financial services easily. 2.23.3 Offering of competitive interest rate: For the promotion of a new finance, offering little higher rate of interest for deposits could be one good strategy. Accordingly, the finance shall offer little higher and better rate for deposit. Similarly, the lending rates are proposed competitive in the market within the working areas. 2.24 Management concepts: Financial Institution (RFL) will have a thoroughly professional management system where emphasis will be given to efficiency and effectiveness concept beside the basic characteristics for management like planning, organizing, coordination, directing and controlling in order to achieve the desired goal. 2.25 Offering better quality personalized service: As the financial market in the country is being more competitive day by day, for a successful operation, the finance will have to provide prompt personalized services to the client, For the improvements of the services, all staff will be given relevant training, in house or outside as required. 2.26 New lending avenues: Beside the traditional loan products such as term, housing and hire purchase, this finance has planned to offer new lending products and financial services to the infrastructure development like hydropower, tourism, IT industry, road, telecommunication, education, etc. 2.27 Services of Experts: The Finance will avail of the services of Nepalese experts/professional as required in different fields related to the financial institution.

Chapter III
3.1 Recruitment & Selection
Procedures For smooth functioning of the recruitment and selection process so that the company can place the right person at right place for higher productivities, the company has adopted the following recruiting and selection process: Need Assessment to be done by HOD in coordination of HR department. HOD must raise the Employees Requisition Form duly approved be the higher authority as specified in the Form. Please ensure make your requisition at least 2 weeks in advance to enable H.R to select the right candidate. As demanded by the situation, H.R department needs to give advertisements in newspaper, contact recruitment agencies, search from previously maintained database and use other means to attract people to apply for the desired post. HRD shall initiate recruiting process in coordination with Recruiting Committee either from internal or from external sources. However first priority must be given for internal recruiting wherever possible. Recruitment committee shall involve in selection process as per the company's Employee Manual 2066. As normal protocol at least three candidates must be short-listed for final interview and selection process and HRD will arrange for the interview in coordination with Recruitment Committee Based on interview grading Recruitment committee should recommend the selected candidates to the Managing Director and/or BOD for final approval Managing Director shall approve the appointment below the position of Manager. Authority to appoint Assistant and below is with Manager-Operation. BOD shall approve the appointment of employees of the position Manager and above. Recruitment of the position other than the approved organization chart strength must be approved by BOD. The probation period of the selected candidate is to be decided by the company according to the nature of Job and Role given.

HRD shall complete all joining formalities as follows: New employee will be given an induction training on the following ( Use HR Induction Check List # RFL/HRM/F/03) General Companies Policies - By HRD RFL corporate philosophy

Confidential Undertaking by HRD (Use Confidential Undertaking Form # RFL/HRM/F/04) Signed all necessary forms and format as per Employees Personal File Check List Opening Bank Account - Operation Department Enrollment for GPA - HRD upon confirmation

HRD communicates the hiring of the new employee to all through the Circular duly signed by Authorized Authority. HRD will provide a copy of employees' compensation package to Accounts Department for payroll processing.

3.2 Appointment of Outsourced Employee


Company does have policy of out-sourcing some workforce in junior positions in the company. The main objective of outsourcing workforce is to enable company to fulfill the short term manpower requirement and to absorb somewhat skilled, trained and already tested best candidates for future recruitment and selection. Procedure/Policy Company may out sourced some workforce as and when required based on its business need. Company will outsource only in Junior Assistant Level and can depute in any department and or in its branch. Outsourced employee will be appointed at least for a year. After one year of service, his/her performance appraisal will be carried out as per the normal company's process. Company itself may recruit and conduct interview and other selection process if require and recommend to Outsourced Contractor for appointment.

Salary and Compensation package will be determined by company time to time which will be communicated to Outsourcing Contractor for preparation of appointment letter. Based on result and comments of performance appraisal report, if employees performance is: o Satisfactory or good he/she will be get into the payroll of company with another probation of one year o Unsatisfactory, he/she will be terminated from the service. If management deems that particular outsourced employee whose performance is unsatisfactory but seems improve in future management can extend his/her service for another maximum six months period of time. After extended probation period, performance appraisal must be done to support the decision of termination/confirmation of the employees. Outsourced employees must comply and obey all rules and regulation of company. Outsourced employees' attendance will be prepared by company's HR department and send to Outsourced Contractors monthly basis for payroll processing. Any deviation for betterment of RFL, motivation of employees and retain performing employees, Managing Director will have authority to approve deviation in any clause mentioned above. Outsourced Contractor will prepare the salary sheet of the employees and arrange for the salary transfer or payment.

3.3 Attendance & Time Keeping


Procedures All employees must report to the duty on specified time and sign on Attendance Register and attendance software system place in the office. After the 10 minutes of grace time from specified office time the register would come to HR Department. HR personnel verify the employees' attendance considering the employees' leave and travel order form. Tardiness is recorded against the employees coming late by marking red pen in the attendance register itself. For exceptional case employees getting late, may inform the both to the HR department and his/her immediate supervisor. But employee must give their attendance on the register as soon as they report to the office with their actual arriving. More than 1 hours of tardiness in a day and 15 hours in month will be recorded and may consider for disciplinary action.

Three red marks in an attendance register against uninformed tardiness will be count as 1 day's LWP. HR Department will continuously monitor the employees' attendance and leave and update and prepare the Employees Attendance and Leave Report at the end of the month duly signed by Head-HR and submit to Accounts/Operation Department for payroll processing. Monthly Leave Report Department wise shall be sent to respective HODs/Supervisor at the end of the month for their information. Office Time: Summer 9:30 am - 5:30 pm (Sunday to Friday) Saturday- Weekly Day Off 9:30 am - 5:00 pm (Sunday to Friday) Saturday- Weekly Day Off

Winter

3.4 Payroll Processing


Procedures Accounts Department is responsible for processing the employee's payroll at the cut off date of 25th of every the month which may be get changed time to time by company. Payroll calculation should be done based on o o Attendance Report duly signed and forward by HR department. Master Salary Sheet duly approved by Managing Director. A copy of

the same must be with HR Department. HR and Accounts Department shall tally and cross verify the Master Salary Sheet they maintain at least once in three months. Accounts Department upon receiving report will prepare the salary sheet and transfer the payments on individual employees' account Account Department will provide the details of EPF deduction and CIT deposit duly signed along with receipt of deposit by Head-Accounts to HR department on timely manner HR department shall prepare the Phatwari and send to respective office and keep record of the same. HR department shall initiate for preparing the ID card of EPF and CIT for new employees upon confirmation.

Accounts Department shall prepare the pay slip and distribute to the employees.

3.5 Leave
Procedures Employee should fill the Leave Application Form # RFL/HRM/F/02 in the prescribed Form duly recommended by his/her immediate supervisor and approved by direct supervisor of the employees' immediate supervisor. o Employees' immediate supervisor shall recommend for the leave ensuring: Immediate back up employee is there to avoid any hindrance in absence of the employees o Employees' Leave Balance through Leave Report forwarded by HR department on monthly basis. For short period of Annual Leave (Less than or equal to the five days) the application should reach the HR department prior to at least a day leaves starts. For long leave more than five days the leave application form should reach to HR department prior to at least 7 days. Similarly for the Force Leave, leave application form should reach to the HR department prior to the 15 days of leave starts and a plan to be given at the beginning of F.Y. HR department will enter the leaves in the HR Attendance and Leave System with in next day. Due to unavoidable circumstances, if an employee fails to give prior notice about the leave, s/he should fill up the leave form and get it approved from HOD and submit it to H.R. However in such cases employee should inform the H.R department and its HOD about the leave through telephone. Employees' leave unless HR department received properly sanctioned Leave Form will be considered as LWP while payroll procession. Employees are responsible to ensure that their Leave Form is reached in HR department in time.

3.6 On Duty/Travel Policy


Procedures

Employee whoever requires to go out side location office on Business Travel needs to submit On Duty/Business Travel Order Form (Use the prescribed Travel Order Form # RFL/HRM/F/05) authorizing by immediate supervisor and/or HOD signing on it. Based on filled up Travel Order Form HR personnel make necessary on attendance records accordingly. 1 For any Hotels and/or Air tickets booking if require employees must inform to HR Department well in advance 2 For any business travel or trip employee can get Cash Advance from Account Department and after completion of Travel, employee must settle advance and/or expense within seven working days (Form # RFL/HRM/F/06) 3 After completion of Business trip Employees required to fill up Trip Report on prescribed Form and submit the HOD and Cc to HRD. HRD keeps records of that in employees travel records files. (Use Trip Report Form # RLF/HRM/F/07) 4 Employee on any business travel or trip gets following travel allowance (Use Advance Requisition Form # RFL/HRM/F/08) actual basis or the limits mentioned below whichever is lower. Travel Allowance
Hotel Stay/ Lodging Per Day Actual 2000 1500 1000 500 400 Mode Of Transport By Air By Air By Air By Bus By Bus By Bus Meals/Food Per Day Actual 800 600 500 300 250

S.N. 1 2 3 4 5 6

Corporate Position Managing Director/CEO GM/DGM/AGM (Executive Level) Chief Manager/ Sr. Manager/Manager
(Manager Level)

Sr. Officer/Officer/ Jr. Officer (Officer Level) Sr. Assistant/Assistant/ Jr. Assistant Messenger/Drivers

1. Business related travel expenses are to be accounted through the prescribed "Settlement of Travel Bill Form" (Use Form # RFL/HRM/F/06) 2. All expenses are must to be supported except for specific items for which receipts cannot be obtained like tips, conveyance in some cases etc. 3. Expenses that require to be supported but employee could not produce the supporting documents/Bills/Receipt need to be approved by Department Head however it would be entirely at companys discretion (Discretion of Final

Authorizing Authority) to approve the same based on circumstances and reasonableness of the expenses. 4. Travel will be by the most economical route and the company decision in this regard would be final. 5. Liquor consumption may sometimes permit for entertainment of business guests only, but has to be within reasonable limits and prior approval from his/her immediate supervisor is mandatory. 6. All employees need to settle their bills themselves rather than have the company pay for the same. 7. Travel expenses need to be settled within three working days of return from the trip.

3.7 Training & Development


Procedures 1. Each Dept. Head/Supervisor in coordination of HR department shall assess the training need of each member annually (Use prescribed Training Need Assessment Form # RFL/HRM/F/12) 2. Department Heads then submit the Training Needs Assessment Form to HR Department. 3. TNA (Training Need Assessment) then be prioritized and tabulated and Master Annual Training Plan is prepared by HR Department and submitted to MD for approval. 4. Head-HR will monitor and review the Training Plan at least quarterly to ensure planned training is carried out. 5. Employee goes for outside training must submit the training material and training certificate to HR Department. 6. HR Department will ask employees who has taken the jobs specific training from outside to conduct the same for other employees within department. 7. All types of Training shall be documented and recorded in prescribed form (Use Training Record Form # RFL/HRM/F/13) for future reference. 8. When the need arises for an employee to move from one discipline to another, HR department in coordination to HODs shall ensure that adequate training will be provided. 9. For all types of In-House Training, Training Feedback will also be obtained to understand the participant's responses (Use Form # RFL/HRM/F/14).

10. When an employee is selected for promotion, the needs for any training, if required, will be identified and provided to ensure that the employee is sufficiently trained and equipped to handle the new function. The identification of training needs and organizing the same would be done in conjunction with Department Head. 11. Marking of the Training and orientation will also be considered during the Annual Performance Appraisal

3.8 Office Vehicle Use


Procedure Office Vehicles will be under direct supervision of Head - HR & Administration. HR department shall monitor the Office Vehicle activities daily. HODs must plan and submit the vehicles activities schedules by 5:00 pm for the next day. HR department will prepare the vehicle schedule for the day based on the HOD request. In case of urgent and/or other requirement, employee must fill up the "Vehicle Requisition Form" (Use Form # RFL/HRM/F/09) duly signed by HOD and submit the HR department. HR & Admin. Department will avail the vehicle to Head of Requesting Department subject to the availability. Office Vehicle is strict prohibited for personal use. If any of the employees need the company vehicle for the personal purpose, Manager-Operation and/or MD should authorize for the same. HRD tracks the mileage run by vehicle every time every day.

3.9 Uniform
Procedure All employees are eligible for company uniform. All employees are requested to wear the company uniform at all time. Employees will be providing the 2 set of Uniform once a year at during Dashain. o Set consists of : Saree. 1 Coat, 2 Pants, 2 Shirts and 1 Tie (For Gents 1 Coat, 2 Pants, 2 Shirts and 1 Scarf (For Ladies) or Set of HR department coordinates for buying Uniform.

All employees must wear the Company Uniform all the day at work during the office time. Friday will be casual day and employee can wear generally acceptable casual dress on that day. For Manager Level and above, Dress Allowance is given which is as follows: Level Manager Level Executive Level Allowances Nrs. 6500.00 Nrs 7500.00

Submission of suit bill is must and reimbursed maximum to above mentioned amount. Reimbursement will be allowed one time in a financial year

3.10 Fuel Policy/Procedure


Procedure/Policy Employees working in Marketing Department who frequently requires going out for business purpose will be eligible to get fuel facilities; it will be based on management discretion taking into account of nature of visit and business requirement. . Employees working in the department other than Marketing will be provide the fuel facilities totally based on assessment of business issuing the separate letter to them. Employees will be provided fuel coupon of any one of the petrol pump on actual consumption basis but within the certain limit determined by management time to time. Employees must maintain the Vehicle Mileage Log Sheet (Prescribed by HR Department) Employees will require filling up the fuel coupon and submitting to HR Department for approval along with the "Vehicle Mileage Log Sheet" duly verified and signed by HOD. HOD also shall require monitoring and verifying the mileage before recommending for fuel coupon. If the mileage meter is out of order than maximum allowed limit will be 20 liters for motorbike and 25 liters for car or 4 wheelers. For other provided till specified arrangement and will be automatically cancelled once transferred or change in assignment. The following is current limits for fuel eligibility which can be changed by management time to time:
S.N 1 2 3 Department GM/DGM/AGM All Department Corporate Level First Class First Class Second Class Position Managing Directors MD/GM/DGM/AGM CM/Sr.Manager/Manager Eligibility On Actual On Actual or 75 Ltrs. Whichever is less On Actual or 75 Ltrs. Whichever is less for 4WH vehicle and 25 Liters or actual whichever is less for 2WH vehicle 25 liter/month or actual whichever is less

Marketing Department

Third Class

& Fourth

2.

Recovery

Third Class

& Fourth

Third Class - Assistant Manager/MT/Sr.Officer/Officer /& Fourth Class Sr. Assistant/Assistant/Jr. Assistant Third Class - Assistant Manager/MT/Sr.Officer/Officer

25 liter/month or actual whichever is less

/& Fourth Class Sr. Assistant/Assistant/Jr. Assistant 4 Others Others Totally based on management discretion and if it is deemed to be provided. Approval to be soughed from MD.

Company has policy of providing adequate communication facilities to support the business operation. Following are the certain policy and procedure.

3.11 Telephone & Mobile Policy/Procedure


Procedure/Policy Company telephone lines must only be used for only business purpose All STD call must be recorded on the telephone log-register kept in cabin of Manager-Operation or any other location as per need of the organization. Employee can make personal/business local phone call but should be limited and reasonable period of time. In addition to that, company shall provide mobile allowance to those employees who frequently require contacting outside during and/or off office time. This is totally based on business need basis. Mobiles are strictly not allowed for switching off. The current eligibilities for mobile allowance for different level is as follows:

S.N 1 2. 3 4 5

Corporate Level First Class Level Second Class Level Third Class Level Fourth Class Level Fifth Class Level

Position MD CM/Sr.Manager/Manager Assistant Manager/MT/Sr.Officer/Officer Sr. Assistant/Assistant/Jr. Assistant Drivers/Messenger

Eligibility Nrs. 3500/ Month Nrs. 2000/ Month Nrs.1000/Month Nrs.500/Month Nrs.200/Month

Employees getting more Nrs 1000.00 or above allowance must have post paid mobile and must produce the actual bills for reimbursement.

3.12 Out Station/ Allowance at Branch Out-Side Valley


Procedure/Policy To support the living of employees working in different branch of the company out side of the Kathmandu valley, company will be providing out station allowance to the employees.

The following are the policy and procedures: Employees working in company's branch office at outside of Kathmandu are eligible for getting out station allowance. But employees originally from same district or 15 km from the location of branch office and or city are not eligible for such allowance. Basically company provide two types of out station allowance: o Out-station allowance o House Rent Allowance Eligibility of Out-Station allowance and its limits is as follows: S.N 1 2. Nature of Allowance Out-station allowance House Rent Allowance Eligible Level/Position Eligible Amount All Employees working who falls under 25% of Basic Salary the policy as mentioned above Branch Manager Only Nrs 4000.00

In case, company provides accommodation house rent allowance will not be provided.

3.13 Resignation and Termination


Procedure/Policy If an employee intends to resign, he should submit resignation through the HOD which would then be forwarded to the HR Department.
1.

2. If accepted employee has to submit Exit Clearance Form filling up from and signed by all the HOD which would be forwarded a copy of the same to Accounts along with memo of working days and other working sheet. 3. HR Department will request to the employee to give feed back regarding the working environment, for the area of improvement in terms of employee satisfaction etc. in Exiting Employee Feed Back ( Form. # RFL/HRM/F/11)

4. A memo or working sheet or email is issued to Accounts stating the eligible leave balance, over time, shift allowance and other allowance duly approved by HRD. 5. Settlement of all the benefits and dues are routed through the HR department

6. If an employee has an outstanding loan, the settlement has to be routed through the employees bank account. 7. HR Department will also issue a release letter from company and experience certificate if the employee is asking for the same. 8. HR Department will collect back company properties from the employee including the ID card. 9. Memo or Email would be sent out informing of the same and displayed on the notice board.

3.14 General Information Policy


To support company's operation and working environment frequent and timely information sharing is significantly important. As we know sometimes pieces of information that seems unrelated can also be clue to solve the problems and identify new opportunities. It does not mean that all information have to be shared to all and everybody. Therefore there will still be justified reason why some information should have limited audience. The motto of this general information Policy is to foster an environment where the amount of information that is considered un-shareable will be minimized and the proactive sharing of information will be increased. Procedure/Policy Information shall be shared or at a minimum accessible to all employees All employees have a right of access to all information only they need to do their job. All employees are urged to affirmatively and rapidly share all information that they recognize as potentially having value to other employee in their jobs. Exceptions: Privacy of individual personnel files. Sensitive marketing and transaction information. Legal obligations and constraints.

3.15 Acceptable Computer Use Policy

The purpose of this policy is to enhance proper and appropriate use of computers systems and computerized information, including computer software and hardware, electronic mail, network connections, Internet access, and related technologies. The main motto of this policy is to protect its computing systems and computerized information from unauthorized access, use, modification, copying, or destruction Moreover employees and other persons who use these systems should not expect the privacy, except as required by any law or other policy as company's computer systems and the information stored in them are the property of the company. Employees and other persons who violate this policy may be subject to disciplinary action up to and including termination. Breaches of this policy must be reported to management. Violations of this policy include, but are not limited to: Disclosing information intended for use only within the company. Disabling a computer systems protection settings if there. Establishing and/or using Internet or third party network connections or Internet web pages with out proper written approval from Management. Using computer systems for personal gain or gain of a third party. Installing or using computer software not approved by the company management. Participating in chain email and other activities where content or audience does not support a business purpose. Accessing, viewing, storing, or transmitting sexually explicit images, text, cartoons, jokes, and any other non-business related stuffs etc. If somehow received and failed to immediately delete such material upon receipt.

Chapter IV
4.1 Research
The function of Human Resources departments is generally administrative and common to all organizations. Organizations may have formalized selection, evaluation, and payroll processes. Efficient and effective management of "Human Capital" progressed to an increasingly imperative and complex process. The HR function consists of tracking existing employee data which traditionally includes personal histories, skills, capabilities, accomplishments and salary. To reduce the manual workload of these administrative activities, organizations began to electronically automate many of these processes by introducing specialized Human Resource Management Systems. HR executives rely on internal or external IT professionals to develop and maintain an integrated HRMS. Before the clientserver architecture evolved in the late 1980s, many HR automation processes were relegated to mainframe computers that could handle large amounts of data transactions. In consequence of the high capital investment necessary to buy or program proprietary software, these internally-developed HRMS were limited to organizations that possessed a large amount of capital. Human Resource Management Systems enabled increasingly higher administrative control of such systems. Currently Human Resource Management Systems encompass: 1. 2. 3. 4. 5. 6. Payroll Work Time Benefits Administration HR management Information system Recruiting Training/Learning Management System

7. Performance Record 8. Employee Self-Service Payroll Module The payroll module automates the pay process by gathering data on employee time and attendance, calculating various deductions and taxes, and generating periodic pay cheques and employee tax reports. Data is generally fed from the human resources and time keeping modules to calculate automatic deposit and manual cheque writing capabilities. This module can encompass all employee-related transactions as well as integrate with existing financial management systems.

Work Time Module The work time module gathers standardized time and work related efforts. The most advanced modules provide broad flexibility in data collection methods, labor distribution capabilities and data analysis features. Cost analysis and efficiency metrics are the primary functions. Benefits Administration Module The benefits administration module provides a system for organizations to administer and track employee participation in benefits programs. These typically encompass insurance, compensation, profit sharing and retirement. HR Management Module The HR management module is a component covering many other HR aspects from application to retirement. The system records basic demographic and address data, selection, training and development, capabilities and skills management, compensation planning records and other related activities. Leading edge systems provide the ability to "read" applications and enter relevant data to applicable database fields, notify employers and provide position management and position control. Human resource management function involves the recruitment, placement, evaluation, compensation and development of the employees of an organization. Initially, businesses used computer based information systems to:

produce pay checks and payroll reports; maintain personnel records;

pursue Talent Management.

Training Module The training module provides a system for organizations to administer and track employee training and development efforts. The system, normally called a Learning Management System if a stand alone product, allows HR to track education, qualifications and skills of the employees, as well as outlining what training courses, books, CDs, web based learning or materials are available to develop which skills. Courses can then be offered in date specific sessions, with delegates and training resources being mapped and managed within the same system. Sophisticated Learning Management System(LMS) allow managers to approve training, budgets and calendars alongside performance management and appraisal metrics. Employee Self-Service Module The Employee Self-Service module allows employees to query HR related data and perform some HR transactions over the system. Employees may query their attendance record from the system without asking the information from HR personnel. The module also lets supervisors approve O.T. requests from their subordinates through the system without overloading the task on HR department. Many organizations have gone beyond the traditional functions and developed human resource management information systems, which support recruitment, selection, hiring, job placement, performance appraisals, employee benefit analysis, health, safety and security, while others integrate an outsourced Applicant Tracking System that encompasses a subset of the above. Assigning Responsibilities Communication between the Employees. People are a companys most important assets. They can make or break the fortunes of a business. In todays highly competitive business environment placing the right people in the right position is very critical for the success of any organization The recruitment and selection decision is of prime importance as it is the vehicle for obtaining the best possible person-to-job fit that will, contribute significantly towards the Company's effectiveness. It is also becoming increasingly important, as the Company evolves and changes, that new recruits show a willingness to learn, adaptability and ability to work as part of a team. The Recruitment & Selection procedure ensures that these criteria are addressed

As being the employee of Reliance Finance Limited I have studied the Human Resource Management within RFL and I have done a SWOT analysis of RFL to find out the existing shortcomings and potential threats and thereby recommended suggestions. This project however is an attempt to share as best as possible my experience in corporate world with all my colleagues and my faculty. I would be delighted to receive readers comments which maybe valuable lessons for my future projects.

I have conducted several deep interviews with persons working within my organization Reliance Finance Limited, I have used my own organization to carryout the research. OBJECTIVES OF THE PROJECT Every task is undertaken with an objective. Without any objective a task is rendered meaningless. The main objectives for undertaking this project are: To understand the HRM Procedural and Practices at Reliance Finance Limited To identify areas where there can be scope for improvement To give suitable recommendation to streamline the HRM Practices

Data Used in Project There were mainly two sources of data collection Primary data:

Survey method Personal interview with candidates In depth conversation with the placement agency

Secondary data:

Study of recruitment policy Websites Published articles

Methodology Before any task was undertaken, I thoroughly studied the HR policies of Reliance Finance Limited in order to get better understanding of the process followed by the company. The first task was to understand the various job profiles which the employee had. The next step was to explore the duties and responsibilities of the employee. The employee were given a questionnaire to fill up their opinion. The questionnaire had various question regarding the employees understanding of HRM practices. Through analyses was carried out on the feedback of the response to the questionnaire. Finally conclusion was drawn based on the feedback of the employees

Research methodology used Study of Human Resource Management Practices in Reliance Finance Limited. The Business Manual which describes the detail of the HRM within RFL has been the root source for my research, besides this material I have used the following for my research methodology.

Journals Magazines Books

Findings

Recruitment and Promotion Attendances / Absence / Leave Motivation of Staffs Trainings Duties and Responsibilities Work efficiencies and effectiveness Salaries, Allowances Reward and Punishment

To pursue these, I would be going through the recruitment policies of the company. By active participation in the recruitment process, the areas where improvement can be bought about can be identified. Thus the whole research would be done under the guidance of external guide.

Limitations of the study

Task:
The HRM Procedural and Practices at RFL involved a lot search from the database and calling up candidates to check whether they fit the job specification. Difficulties: Candidates were reluctant to talk at times; Candidates who were scheduled for interview would not turn up; Run out of database many times since most of them would have already

been contacted; Task: Candidates were to be searched from the job portals and called up to be scheduled for an interview.

Difficulties: Did not secure cooperation easily; People asked lot of counter question so convincing them was a major task; People did not disclose much about their employee details.

Chapter V
Research Questionnaires
It is a process for determination and assuring that the organization will have an adequate number of qualified persons, available at proper times, performing jobs which would meet the needs of the organization and which would provide satisfaction for the individuals involved. It involves * Estimation of present and future requirement and supply of human resources basing on objectives and long range plans of the organization. * Calculation of net human resources requirement based on present inventory of human resources. * Taking steps to mould, change, and develop the strength of existing employees in the organization so as to meet the future human resources requirements. * Preparation of action programs to get the rest of human resources from outside the organization and to develop the human resources of existing employees. Induction and Orientation: Induction and orientation are the techniques by which a new employee is rehabilitated in the changed surroundings and introduced to the practices, policies, purposes and people etc., of the organization. (a) Acquaint the employee with the company philosophy, objectives, policies, career planning and development, opportunities, product, market share, social and community standing, company history, culture etc. (b) Introduce the employee to the people with whom he has to work such as peers, supervisors and subordinates. (c) Mould the employee attitude by orienting him to the new working and social environment. In my research, I have formulated following questionnaires which was distributed to the employees of Reliance Finance Limited. Each questions had a benchmark to analyze the employees feeling towards the organization and to analyze the employees own psychological behavior.

Following are the questions which were distributed among the employees 1) Why did you join RFL? a) to earn money b) to earn self respect c) to build up carrier d) to spend time 2) a) b) c) 3) a) b) c) Are you satisfied with the pay you are getting? Extremely satisfied Just Satisfied Not Satisfied Do you prefer to work after office (over time) ? Yes if the company pays me No even though the company pays me I would work over time even though the company does not pay me

4) Training Needs: Do you think the training will improve your job performance a) Yes b) No 5) a) b) c) What factor motivates you? Reward by giving you a bank Cheque An appreciation Letter Reward by increasing your grade

6) Are you satisfied with your job? a) Yes extremely satisfied b) Just satisfied c) Not satisfied 7) Are you satisfied with the annual leave / casual leave policy of the company? a) Yes

b) No 8) a) Yes b) No 9) a) Yes b) No 10) Are you satisfied with the Allowance Policy of the company?

Are you happy with the performance appraisal system of your company?

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