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The case deals with the problems faced by the Nalaysian Airlines, the national flag air carrier of Nalaysia. The case examines the strategies pursued by NAS to overcome the challenges.
The case deals with the problems faced by the Nalaysian Airlines, the national flag air carrier of Nalaysia. The case examines the strategies pursued by NAS to overcome the challenges.
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The case deals with the problems faced by the Nalaysian Airlines, the national flag air carrier of Nalaysia. The case examines the strategies pursued by NAS to overcome the challenges.
Авторское право:
Attribution Non-Commercial (BY-NC)
Доступные форматы
Скачайте в формате DOCX, PDF, TXT или читайте онлайн в Scribd
Nalaysian Airline System Berhad (NAS) Human Capital !ssues and Strategic Solution Program: Bachelor of Aviation Nanagement, UniKL N!AT
By:
Nuhammad Afiq Aqwa Nd Nansor S3276210188 Bachelor of Aviation Nanagement, UniKL Nalaysian !nstitute of Aviation Technology
Nuhamad Nazmi Nohd Chazali S3276210236 Bachelor of Aviation Nanagement, UniKL Nalaysian !nstitute of Aviation Technology
Atikah Nuhd Sahar S3276210024 Bachelor of Aviation Nanagement, UniKL Nalaysian !nstitute of Aviation Technology
Nur Fatin Che Soh S3276210022 Bachelor of Aviation Nanagement, UniKL Nalaysian !nstitute of Aviation Technology
Date submitted: 14 April 2011
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2
Abstract
The case deals with the problems faced by the Nalaysian Airlines, the national flag air carrier of Nalaysia. While the company had many notable achievements, since the 1370s, it began to face major financial trouble since late 1330's. The case examines the strategies pursued by NAS to overcome the challenges. The case also describes a brief description of demands and challenges in the international airline industry.
Purpose - This study seeks to investigate, through the Human Resources Nanagement practices in the context of several issues discussed, whether the issues are manageable and gives an impact to the whole organization.
Design/methodology/approach - A discussion was held with the lecturer of Human Resources Nanagement and several experienced lecturers that have been a managers in the industry itself at the specific department. The theories are applied in this research and been transformed into a model. The model is developed, we come out with additional theories. Our group has come with a hypothesis that performance of a company tallies with the Human Resources Nanagement strategies and efficiency because the output of the individual performance can affect the whole organization performance. We are required to look for issues that are related to Human Resources Nanagement in a particular company and seek for solution to handle an issue. Then, a deeper exploratory factor analysis is used from a conducted interview with the Human Resources Nanagement in the company itself focusing on the Engineering Department in NAS.
Findings - The dominant issues in HRN practices in NAS were found to be: Tangibles, Recovery, Responsiveness, and Knowledge. Further results indicate that, although the direct effect of HRN practices is important, the indirect effect with NAS handling the matters in the way of practicing the human resources management theories that we have learnt is a stronger driver for the organization to perform its best. Through our findings and methodology that is we sent a general questions Puman 8esources ManaaemenL | Croup no 4
3 to the interviewees that are related to our research and we add new questions based on the interviewees' reaction and answers.
Research limitations/implications - A notable limitation is that the present study focuses only on the airline services and uses only one industry (Air transportation industry) to illustrate the findings. Future research should examine other aviation service categories.
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4 !ntroduction
The commercial airline is an extremely competitive, safetysensitive, high technology service industry. People, employees and customers, not products and machines, must be the arena of an organisation's core competence. The implications are vast and pervasive affecting no less than the organisation's structure, strategy, culture, and numerous operational activities. Pertaining to this, a lots of issues of Human Resources Nanagement arises in retaining the competencies. Strategic management seeks to coordinate and integrate the activities of the various functional areas of a business in order to achieve longterm organizational objectives. A balanced scorecard is often used to evaluate the overall performance of the business and its progress towards objectives. Human Resources Strategic management provides overall direction to the enterprise and is closely related to the field of Organization Studies. Strategic planning and management are more than a set of managerial tools. Train some of the employees in the area of time management, material handling at work etc. Retrenchment of surplus employees caused due to superior speed Pay for performance Promotions based on efficiency High quality work environment at the production place.These human resource issues are also known as functional strategies of HRN. !n many cases the response to the problem or opportunity will require the continuous attention of senior management of the organization. Be interconnected with other issues and developments. Suboptimisation, or poor quality in regards to management, decision making, teamwork, employee motivation, or communication can translate into loss of customers, loss of market share, loss of organisation assets, and above all, loss of life. !n such a safetysensitive, customer servicecentric environment, the traditional productcentred industrial model of corporate structures and industrial relations is inappropriate. Human resource management (HRN) expertise is required now, more than ever, to spearhead internal marketing strategies in order to gain customer lockon. The primary area of focus of strategy is the manner in which the HR department in NAS.
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3 Nalaysian Airline System Berhad (NAS) Background
Nalaysian Airline System Berhad (NYX:3786), DBA Nalaysia Airlines(abbreviated NAS), is the governmentowned flag carrier of Nalaysia. Nalaysia Airlines operates flights from its home base, Kuala Lumpur !nternational Airport, and its secondary hub in Bayan Lepas, Pulau Pinang. !t has its headquarters on the grounds of Sultan Abdul Aziz Shah Airport in Subang, Selangor.
O Organisational vision
To be the largest, most successful and most respected airline in the world."
O The Beginning
Nalaysia Airways Ltd. (NAL) was founded in 1347 by British Overseas Airways Corporation (BOAC now British Airways), Ocean Steamship Company of Liverpool and the Straits Steamship Company of Singapore. By the end of 1347, Nalayan Airways engaged in an expansion exercise and NAL began providing regional flight services. The presence of BOAC also facilitated NAL's entry as a member of !ATA. A year after the !ndependence of Nalaya in 13S7 and with the participation of BOAC, OANTAS, the government of the Federation of Nalaya, Singapore and the Territory of North Borneo, NAL was launched as a public limited company. NAL then entered the jet age with the purchase of vickers viscount aircraft and by 1360 NAL propelled into other farflung regions of Asia. The acquisition of an 82seater Briston Britania in 1360 made mass transport by air a reality. This marked the first international nonstop service for NAL, which operated directly between Kuala Lumpur and Hong Kong.
After the formation of Nalaysia in 1363, the airline was renamed as Nalaysian Airlines Limited (NAL). The formation of a new nation saw the need for NAL to be a national carrier to integrate and connect the far corners of Nalaysia. Two years later, Borneo Airways merged with NAL resulting in fleet and network expansion. !n 1366, the Covernments of Nalaysia and Singapore became the majority shareholders in the national carrier and Puman 8esources ManaaemenL | Croup no 4
6 NalaysiaSingapore Airlines (NSA) was formed. !n 1371, the partnership between Nalaysia and Singapore was dissolved, and Nalaysia Airlines Berhad was incorporated. With an authorized capital of RN100 million1, the company made a final revision to its name in November 1371, and Nalaysian Airline System Berhad (NAS) was born. By 1372, Nalaysian Airline System was already servicing 34 domestic routes and six international destinations.
O Nodernization
The year 1376 saw NAS enter the information age, when it computerized its whole operation. !n the 1380s, NAS became the first major government agency to be privatized but a change of business practice did not change the company's focus on being customer driven. As part of its modernization and expansion, NAS also invested in a new maintenance hangar facility, as well as extending its catering facilities in Subang, where the then international airport of Nalaysia was located. As a final part of the restructuring exercise, NAS moved into its new corporate headquarters to a 36storey building, which became the hub for the future direction of the company.
O Clobal reach
The year 1386 saw NAS offer the first flight service to the United States. By the end of 1387, NAS had established itself as an international carrier of choice, offering 34 domestic routes and 27 international destinations. NAS changed its corporate identity and became known as NAS, with the objectives to create a greater awareness of Nalaysia. As part of its fleet modernization program, NAS invested RN3.6 billion to expand its fleet of aircrafts in 1331.As of Narch 2001, NAS had a fleet of 3S aircrafts in its network serving over 114 destinations.
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O Achievements
NAS received international acclaim from many independent organizations for various aspects of its services. !ts top management team received an award from the Asian !nstitute of Nanagement and the World Executive Digest, for its excellence in general management and success in positioning itself in the airline industry. NAS received numerous awards in the airline industry, advertising industry, worldclass publications, NCOs, private institutions, and independent research groups. Even during the economic downturn, some of its achievements were notable.
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8 Arises !ssues O Problem 1 Push and pull factor for the employees !ssue The push and pull factor is the common problem in any airline industry whereby the pay for the job is demandable and varies according to the offer that is made by the airlines especially for the License Aircraft Engineers (LAE). From our interview, this situation is often happen in the engineering department in NAS whereby the experienced LAEs that have worked for them for more than 10 years walk away to work with another airlines because of the pulling factor made by the other airlines such as higher salary, more benefits for the employees, exclusive and different working environment, opportunities to live outside of Nalaysia and many more pulling factors that are the cause of this situation happens. Same goes to the pushing factor which is the internal factor of the company that causes the employee to walk away from NAS. Discussion According to Nr. Abdul Rashid Sharif and his companion Nr. Nuhammad Hilmi Nokhtar, from the Human Resources Nanagement in NAS Aerospace Engineering (NAE) department the pulling factor from another airline is normal to NAS where other airlines like in the Niddle East such as Emirates were expanding and they need readymade engineers who have working experiences and attitude in supporting their expansion. At the same time, Emirates needed to employ massive numbers of experienced and new employees as fast as possible. This is where the pulling factor is so strong. Same goes to the national low cost carrier, Air Asia whereby a lot of young engineers who have work in NAS for only about 2 to 3 years are being offered by Air Asia to work with them and they paid double or triple the salary that they can get in NAS. Even the veteran who has worked in NAS for more than 1S years left to Air Asia. Then, raise another question, did NAS aware the pushing factor that cause so many of their engineers left the company?" Pushing factor for NAS is where the airline is bleeding money during in 200S to 2007. NAS were having a financial problem and the motivation of NAS workers at that time were at the lowest. As for the employee who did not satisfy with their salary and they were afraid that they will be terminated due to the financial crisis, the employee seeks for another airlines that having more stable in terms of financial and Puman 8esources ManaaemenL | Croup no 4
9 employment management and it was an opportunity for them to get higher salary and make a better living. An information that we get from to our lecturer, Nr. Naulan Bardai, who was once an employee and appointed Nanager in the HR Engineering Department in NAS said that if an employee who wants to leave NAS will have to fill up a resignation from. !n that form, the employee needs to tell the reasons to leave the company. And by doing so, the company knows what is the reasons that become the pushing factor that cause the employees to leave NAS. So, the employees were leaving NAS for a strong push and pull factor. !t is a difficult time for NAS to minimize the pushing factor.
As a measure to deal with this problem, NAS have to hire expatriates of engineers from other airlines such as Oantas, Lufthansa, S!A and many more airlines trough out the world. Currently, there are more than 60 expatriates engineers that work in NAS. NAS also had taken an action to minimize the pushing factor by restructuring their corporate strategy. NAS Aerospace Engineering (NAE) has rebranding their vision which is 'to be the preferred global NRO organization' and their new mission is 'to deliver excellent aerospace engineering services, provide value to customers, maximize returns to stakeholders and be the employer of choice'. By rebranding their new vision and mission, NAS Aerospace Engineering comes with the values of safety and quality, passion for excellence, integrity, teamwork and business sense (serve customer, make money, save money). As a result, NAS Aerospace Engineering has been Awarded Asia Pacific Airframes NRO Center of the Year" by Frost S Sullivan and Aviation Week's Overhaul S Naintenance 2003 Best Asia Pacific Airline NRO Operation. This achievement has made NAS Aerospace Engineering the preferred choice in Asia Pacific region and in the whole world. Further on, NAS has successfully minimizing the pushing factor and this also has become the strong pulling factors for the engineers to stay working in NAS. Deepening into this problem, another issue that is very critical in NAS is the 'job design' issue. ]ob design is the role that plays by a particular person in a particular job. For example, the store man in NAS. The store man in NAS is not wide and it is limited only to that role. According to Nr. Naulan opinion, job design is a good solution to minimize pushing factor in a company. !f the design of the job is wide and variety, the capacity of Puman 8esources ManaaemenL | Croup no 4
10 earnings can be maximize and the job scope of that particular employee has been enlarged. Furthermore, the salary of the employee can be higher and thus this will lead to maximization of job satisfaction to the employees. This can help to reduce the pushing factor in one organization. !n addition, Nr. Naulan stated that, he was doing his research in 13321333 about NAS job design. He found that NAS job design is the just the same from 1372, the year NAS was established until 2003 which is the year Nr. Naulan resigned from NAS. However, until now, we still not sure whether the job design in NAS has been revise to widen the scope of the job.
Opinion - !n our opinion regarding the pull and push factors, the organization have to minimize the pushing factors that causing employee to runaway from the company and work with another company since the pulling factors are cannot be controlled by the management. The organization needs to practice a healthy and friendly working environment in order to minimize the pushing factors and keep the employees motivation at peak. Besides that, the company has to maintain the performance of the organization to avoid pushing factor and be competitive.
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11 O Problem 2 Discriminations and diversity practices !ssue - Discrimination means unfair treatment of a person or group on the basis of prejudice. !n other words biasness or unfairness. Discrimination in this case usually refers to gender discrimination between men and women where women always being looks down by men, or where women have to compete in the men world. On other hand, the "business case for diversity", theorizes that in a global marketplace, a company that employs a diverse workforce (both men and women, people of many generations, people from ethnically and racially diverse in backgrounds and have different traits. !n the aviation industry, diversity practices are applied whereby, men and women work together, differs from ethnicity, backgrounds and beliefs and also work with the people from all around the world because aviation industry is a global industry. But there is a gap between men and women capabilities where women cannot go for a higher position or higher management job such as being appointed as a Nanaging Director and Chief Executive Officer (C.E.O) and likewise. The term is called 'glass ceiling' Discussion - From our interviews, both men and women are treated equally in NAS until it reach at certain things that are requires consideration from both men and women. According to Nr. Rashid, in NAS Aerospace Engineering, men and women are treated fairly. Nen and women are doing the same job appointed to them. NAS practices a strong teamwork in their working environment whereby men and women have to collaborate to make sure the job done is at the best quality. When come to a certain level where women who does the technical job such as maintaining the Power plant unit, airframe maintenance, cabin, avionics instruments, auxiliary power unit (APU), radio and many more technical work. After the women get married and have kids, the women engineers or technician will be given an option to be moved to the white collar work. The women engineers given a choice to change to office environment that is proper to married women. The term whitecollar worker refers to a salaried professional who performs semi professional office, administrative, marketing and sales coordination tasks, as opposed to a bluecollar worker, whose job requires manual labor. On the other hand, women who work for NAS have been given other benefit which is a protection for them. Women who have work until late night or working until more than Puman 8esources ManaaemenL | Croup no 4
12 2200 hour (10 p.m.), they will be provided a free transportation by NAS to send them home. This benefit is stated in the Employment Act 13SS (Act 26S) (refer to Appendix 4) . This benefit applies to all women either in technical job or in the white collar job. This is to protect the women employees and to give equal right for the women to compete with men. !n addition to that, there are also several more benefits as stated in in the Employment Act such as maternity leave. Besides that, NAS also have an issue of gender bias practices. !n this issue, NAS has discriminated the unfair and unequal treatment of the female cabin crew has a direct impact on women's access to equal opportunities. A memorandum on gender bias practices by the NAS by the joint initiative against gender discrimination was made. The ]oint !nitiative (refer to appendix 1) strongly disagrees with the discriminatory practices of NAS. They believe that NAS has discriminated against female cabin crew on the basis of gender and denied them of their right to work in a nondiscriminatory and stressfree environment. Bearing in mind women workers make up 60% (2300) of the NAS cabin crew, it is their inalienable right to fair and equal treatment. This memorandum seeks avenues to end genderbased discriminatory practices and to recognize women workers' right to equality and justice. Further on, NAS have an issue regarding the discrimination retirement policy to women stewardess. Women stewardess in NAS has to retire at the age of 40 and another five years extra for those in senior positions. This discrimination is even more pointed when compared to their male stewardess, in which male flight attendants are given the option of retiring at the age of SS (refer to appendix 2) . !n this issue, it has become a problem where women who have reached the age of 40 and above are not as attractive as they used to be. This issue has thickening the layer of discrimination to the already sexist and ageist statement. NAS should start to value their employees beyond perceived gender stereotypes and instead take a REAL look at these women who are vibrant, intelligent and attractive, and who possess an added advantage experience. !f not, and if such ancient principles are continued to be enforced, NAS might find itself in the precarious position of losing such experienced stewardess.
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13 Opinion - From our perspective, NAS did face the discrimination problem frequently. NAS did try to avoid discrimination between their workers and as one of their values is integrity and teamwork in their working environment has made them success. NAS did counter the problem and manage to solve it on its own way. !n NAS, both women and men can work in harmony and equally as every opportunity provided by NAS to both men and women are the same as long as they achieve their mission and vision. Diversity in a working environment is a good and conducive working environment.
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14 O Problem 3 Employees Union (NASEU) !ssue Employees Union is a representative of the group of the employees in the company to represent the employees. Employees' Union is usually a separate management of the company and the employee. !t is a group. And the union will voice out to the company administration about what they want and they demanded a negotiation between them members and the company's management. They will negotiate about their salary, benefits, allowances and many other things. Same goes to NAS. !n NAS, there is an Employee Union which is called, NAS Employees Union (NASEU) and it is classified as an association. NASEU is the representative of the group people in the company to voice out about their salary, benefits that they can get while working in NAS, what they did not satisfy with the company and many more.
Discussion - in 1371, five new joint councils were introduced without collective bargaining rights. Henceforth, the scope of the union's role was limited and it merely assumed consultation status the government. !n essence, the government would solely decide on most matters affecting the workers and unions. The same year witnessed the Nalaysian Airlines System Employees Union action, which received solidarity support from international workers organizations. This provided the pretext for more restrictive trade union and labour relations laws to control public and private sector unions. A strike was held in an action of demanding pay rise from NAS and resulting the operation of NAS was disrupted. NAS been closed for 2 weeks. About the same time, CUEPACS deputy president A. Ragunathan and secretary general ]amaluddin bin Nohd. !sa had also visited Tun Dr. Nahathir Nohamad and, within two weeks, the bickering between CUEPACS leaders and the Nalaysian Trades Union Congress (NTUC) became public. That is the beginning of the Employees Union problem. Then, cames several more of the NASEU problem such as demanding of their rights and fairness as mentioned in above issue. NASEU intervention to the management of NAS regarding the dissatisfaction of the demotion of workman, Ungku Yacob Ungku Suleiman (refers to Appendix 3) . This case has been up to the court and it is between NASEU and NAS Puman 8esources ManaaemenL | Croup no 4
13 berhad (Nalaysian airlines system bhd v. Nalaysian airlines system employees union peninsular Nalaysia industrial court, ]ohor). The union was unhappy with the decision of the company to demote the workman from the position of customer services officer, a Crade C position to the lower position of customer services agent, a Crade B position. This is a trade dispute referred to the Court by the Honourable Ninister of the Human Resources under s. 26(2) of the !ndustrial Relations Act 1367 ('the Act'). !t is in respects of the demotion of one Ungku Yacob Ungku Suleiman ('the workman'), a member of the Nalaysian Airlines System Employees Union, Peninsular Nalaysia ('the union') by the Nalaysian Airlines System Berhad ('the company'). NASEU has been demanding more and more to NAS about pay rise and more benefits for their members for quite some time and what NAS do to overcome this problem is by dealing closely with NASEU, negotiating with NASEU representative and tried to reasoning with them. NAS cannot simply ignore NASEU because it is protected by the Act and laws. So, what NAS management do is by to treating NASEU nicely. Besides that, NAS also have gained the benefits for their employees to void any dissatisfaction and problems arise by NASEU. Opinion - Appointing the Employee Union in NAS (NASEU), we observe that Employee Union is a good platform to find out what the employees wants and to survey how the HRN efficiency can be improved from the Employee Union. HRN can work together with Employee Union to handle the problems regarding the Human Capital Nanagement. Further on, NAS can use NASEU as a platform to negotiating with the employees.
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16 O Problem 4 - Competencies (Asset or Liabilities) !ssue What is a kemployee, and who is worthy of such a title? Nuch has been written on the subject of kemployees, and in our opinion most of it flat misses the mark. !n fact, go so far as to say that what most people refer to as kemployees are not really assets, but rather large liabilities. !f you allow your organization to be held hostage by those employees who feel like they are indispensable, you are only exacerbating the problem. The need to retain talent and reduce turnover, disputing the conventional wisdom of how most businesses address the risk of managing key employees. A fresh perspective on the employees competencies. Discussion To be a competitive airline, the airline should have better performance to compete with other airlines in the world. That was how Nalaysia Airlines did to be one of the competitive airlines and become S star airlines in the world. Started from domestic carrier in 1347, Nalaysia Airlines turned into an international airline in less than a decade. Today, Nalaysia Airlines flies around S0,000 passengers daily to some 100 destinations worldwide. The airline holds a lengthy record of service and best practices excellence, having received more than 100 awards in the last 10 years. During our visit at NAS Aerospace Engineering, Nr. Abdul Rashid who is a Nanager Staff Affairs and Human Resources and his colleagues, Nr. Nuhammad Hilmi Nokhtar said that there are several methods to maintain and improve the organization performance especially in the Engineering Division. Starting from recruitment, they are very strict in selected those employees. They have adopted one method known as, Aptitude Skills Knowledge (ASK). ASK method is that, they need a discipline, punctual and smart employee. Rather than that, they need an employee that has a skills pertaining to the position offered and additional knowledge in aviation field. Besides, the candidate needs to match those requirement that stated by the organization. From ASK method, NAS can filter those who are only the best to work with them and this way, NAS can control the quality of their job and performance of their organization. Noreover, they applied Personal Fatigue Delay (PFD)
in order to produce a productivity employee. PFD is the method to measure the working hours of the employee used/spent during carried out the job. These PFD must meet the Day in Life out (D!LO) working Puman 8esources ManaaemenL | Croup no 4
17 portion. As example, in Engineering and Naintenance Division, the D!LO is 80%. !t means that, an employee that work 10 hours a day need to perform 80% from their working hours , 10hrs x 80% = 8hours. 8 hours is the useful hour to the employee to perform their work, while the other 2 hours is the deduction hours from 10 hours. Usually, the other 2 hours, are for another living activities as a human being that includes going for a break, eat and many more. That was how the organization measured the productivity of the employees towards to be a performance organization. Since they have introduced and practiced lots of method, unfortunately there are several causes and effects to the organization. These cause and effect need to be monitored and prevented, otherwise it will affect the organization performance. Regarding to Nr. Hilmi, they have adopted cause and effect diagram by Kaoru !shikawa (refer to appendix S) . The cause S effect diagram is the brainchild of Kaoru !shikawa, who pioneered quality management processes in the Kawasaki shipyards and in the process, became one of the founding fathers of modern management. The cause and effect diagram is used to explore all the potential or real causes (or inputs) that result in a single effect (or output). Causes are arranged according to their level of importance or detail, resulting in a depiction of relationships and hierarchy of events. This can help the organization search for root causes, identify areas where there may be problems, and compare the relative importance of different causes. Opinion - !n our opinion, Nr Rashid, Nr Hilmi and other colleagues did a great job in order to match their productivity to what they can do to the organization. They have introduced, developed and applied lots of methods to improve and maintain the organization performance. Even though there are effects or causes to the organization, they applied 'HotStove Principle', created several methods of solution and took an immediate action. Last but not least, to be a competent and effective organization, an organization cannot stand alone without individuals or people who are supposing to support them at any level. Each of the divisions or departments need to corporate together towards achieving the organization objectives.
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18 Learning Points
O Ethics and Noral perspective
Sensing a need to connect ethics and moral in Human resource is important in Human Resources Nanagement. Referring to our first problem that is 'discrimination and diversity practices in the corporate environment', ethics and moral plays an important role in HRN. Ethics include fairness, judgmental, beliefs, justice and many more that are related to ethics and moral. !n our observation, ethics and moral is the base line in managing Human Resources. We can relate that in managing human resources, we need to be fair, justice in making actions, no discrimination, we have to be diverse in beliefs and background, we have to be inclusive and motivation based on ideas of right and wrong. !n concerned with principles of right and wrong or conforming to standards of behavior and character based on those principles, "moral sense", "a moral scrutiny", "a moral lesson", "a moral quandary", "moral convictions", "a moral life" is applied in Human Resource Nanagement. A Code of Conduct is a written collection of the rules, principles, values, and employee expectations, behavior, and relationships that an organization considers significant and believes are fundamental to their successful operation. A code of conduct enumerates those standards and values that make an organization remarkable and that enable it to stand out from similar organizations.
O Aligning with the corporate strategy
!n addressing our fourth problem that is 'Competencies (asset or liabilities)' , the objective has been to improve liquidity through better yield management, effective management, and better organizational structure, preplanning of corporate structure and needs for committed in working capabilities. Noreover, key employee title is a good motivation for the employee to improve their working performance as an individual thus, if an individual is performing well, the organization also will perform well. !n addition, it aims to initiate efforts to normalize its leverage and capital structure to bring HRN more in line with its corporate strategy to compete in the industry. HRN also strive to be standard in terms of operational productivity, service levels and costs. !ts focus is on improving quality and Puman 8esources ManaaemenL | Croup no 4
19 efficiency, and putting a halt to all form of abuse within the organization. HRN intends to reassess the effectiveness of its role in corporate network and trying to give the best out of it. This involves reviewing the viability of the existing plan structure and organization, and the realigning and re deploying of its men power capacity to markets that offer the greatest opportunities for all. Furthermore, HRN has instituted various improvement programs to raise efficiency and productivity levels to industry standards. Nutually beneficial cooperation, alliances and tactical arrangements are also being explored with interested industry.
O Deepening into employment act studies
From our visit, Nr. Abdul Rashid Sharif suggested that student that study management should go into deep learning about Employment Act. Referring to our second and third problem that is 'Discrimination and diversity practices' and 'Employee union' , in Human Resource Nanagement, Employment Act is a part of the guidance and rules especially when it comes to hiring, firing, promoting, laboring and many more that are connected with the employment. Some company simply just ignoring the Employment Act and they did not conducting their employees according to the law. Nowadays, employees are protected by the law and employers cannot simply hiring and firing the employee. Employers who are recruiting must know and understand the laws, and at the same time follow the laws that are stated in the Employment Act.
O Up to date with current situation
From the methodology of our research, from what we can sum up is that we can get the most current issue of what happen in the industry. From this point of learning, we can get something that is more that we can learn in the lecture and in the books. We can just learn the theories from the lecture and on the surface understanding of the theories. But, in this exercise, we can relate the theories with the real life working environment. Thus, it helps us to enhance our understanding in this subject and we can practice our knowledge from the theories and make it into a new theory. Furthermore, by practicing this exercise, we can also get more opinion and gain experiences from the experienced people in the industry. Their opinion and experiences are priceless in contrast to what we can pay to learnt in the class. Puman 8esources ManaaemenL | Croup no 4
20 Conclusion
!n conclusion, our research made it clear for us to recognize the theories that we have learn in the class and applied it in this research. This is directly as a practical exercise for us in understanding more about this subject and its significance in our study. From our hypothesis and observation, whether Human resources Nanagement giving an impact to the whole organization's performance. The can relate that the theories that we have learnt in the class and books is successfully applied in this research and we conclude that the hypothesis is true that Human Resource Nanagement give a big impact to the whole organization's performance. The issue stated in this research proves that an efficient Human Resource Nanagement is crucial in an organization to be success. The primary area of focus of strategy is the manner in which the HR department in general aligns activities, policies and procedures with the recruitment and selection and diversity and equal opportunity imperatives of the organisation. Each of the individual positions has characteristics that may be used to expand and/or defend their sustainability of their business growth.
Crowth and profitability are ultimate objectives from any actions taken. !dentifying issues such as companyfocused or competitionfocused and stays within boundaries or pushes the boundaries are matrix variables that guide assessment. The NAS aviation market provides distinctive examples of a business in each of the businesses that NAS do, thus applying the theory to a realworld situation. NAS must constantly expand the market while defending against other airlines that seek to take a greater share and Human Resources Nanagement in NAS must play bigger and more important role in involving the company's management.
From this exemplification of the strategy simply stated is that the market environment is dynamic and constant assessment is necessary. Nanagers seeking to maximize differential advantage and the competition have a wealth of strategy tools available. Each one provides information. Using more than one contributes to a manager's ability to understand the working environment in Human Resources Nanagement. !n a nut shell, this exercise gives us a deep understanding in managing Human Resources. Puman 8esources ManaaemenL | Croup no 4
21
Future !mplication From this research, we have come out with one new idea to apply in our future research. We decided to do an industrial survey to research and investigate about problems that arise in the organization. Then, by using our knowledge in statistics, we can do a hypothesis testing and identify the problems and solve it using statistics hypothesis testing. From that analysis, we can go into deep research about particular problems and solve it. !n addition, we can propose the research that has been done to be shown to the particular company. By doing so will help us and the Bachelor of Aviation Nanagement course is well known and recognized by the industry.
Acknowledgement
We thank to all of the persons and organization who were involved in this research especially the representative from the Nalaysia Airlines System (NAS) Berhad, Nr. Abdul Rashid Sharif and Nr. Nuhammad Hilmi Nokhtar who have kindly assisted us in discussing the issues faced by NAS and being very helpful in this research. The management of UniKL N!AT, especially our Lecturer in Human Resource Nanagement subject, Nr. Nor Hisham Chafar, Nrs. Sahzilawati Nohd. Nor, Head of Aerospace Section, UniKL N!AT for permitting us in getting approval for the visit, Nr. Suhaimi ]antan who helped us to get contact with the representative from NAS and gave a very supportive information and guidance and last but not least our Business Ethics lecturer, Nr. Ahmad Naulan Bardai who gave us a lot of guidance in preparing for the visit and giving us so much information regarding the Human Resources in NAS. And finally to, Nrs. Zabariah N.D !brahim for checking the final draft of this document. Not to forget, to all of our lecturers and individuals who have helped us in doing this research.
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22 Appendix 1
NENORANDUN ON CENDER B!AS PRACT!CES BY THE NALAYS!A A!RL!NE SYSTEN BY THE ]O!NT !N!T!AT!vE ACA!NST CENDER D!SCR!N!NAT!ON
This memorandum is prepared by the ]oint !nitiative against Cender Discrimination by the Nalaysia Airline System (NAS), the national carrier of Nalaysia. This initiative is led by: Nalaysia Airline System Employees Union (NASEU) and supported by: All Women's Action Society (AWAN) Women's Development Collective (WDC) Women's Aid Organisation (WAO) Nalaysian Trades Unions Congress (NTUC) Women's Committee National Council of Women's Organisations (NCWO) Women's Centre for Change (WCC) Sisters in !slam (S!S) The ]oint !nitiative strongly disagrees with the discriminatory practices of NAS. We believe that NAS has discriminated against female cabin crew on the basis of gender and denied them of their right to work in a nondiscriminatory and stressfree environment. Bearing in mind women workers make up 60% (2300) of the NAS cabin crew, it is their inalienable right to fair and equal treatment. This memorandum seeks avenues to end genderbased discriminatory practices and to recognise women workers' right to equality and justice. !SSUES RA!SED ACA!NST D!SCR!N!NATORY PRACT!CES The unfair and unequal treatment of the female cabin crew has a direct impact on women's access to equal opportunities. The differences in treatment are considerable and they are as follows: 1. RET!RENENT ACE Existing Employment Conditions There exists gender biasness in the retirement age, whereby female cabin crew take early retirement at 40 years of age or 4S years for female supervisors, whilst all male cabin crew retire at SS years of age. Upon early retirement, a female cabin crew receives a "special gratuity at the rate of RN800 per year for every completed year of service with the Company". Discriminatory Practices i. The existing employment conditions contravene Article 8|2] of the Federal Constitution, which clearly states that "there shall be no discrimination on the grounds only of religion, race, descent, place of birth or gender". This guarantees the right of women and men to equal pay for equal work or work of equal value. Puman 8esources ManaaemenL | Croup no 4
23 The different ages of retirement for NAS female and male cabin crew violate the Federal Constitution. ii. The retirement age for female cabin crew from other international airlines puts to shame the employment policies of NAS. Their retirement age are as indicated below: Air !ndia 60 years Thai Airways !nternational 60 years Cathay Pacific 60 years All Nippon Airways 6S years Lufthansa 60 years Air Asia SS years iii. !t is also known that double standards are practiced by the management of NAS. For example, expatriate female cabin crew, employed by NAS, are allowed to retire at the age of 60 or 6S, in full compliance with their country's employment law. Yet, when it comes to its own Nalaysian staff, female cabin crew are forced to retire early. iv. Nalaysia is also committed to uphold respect and equality for women being a signatory to the UN Convention for the Elimination of All Forms of Discrimination against Women (CEDAW). Under Article 11 it states that: 1. State Parties shall take all appropriate measures to eliminate discrimination against women in the field of employment in order to ensure, on a basis of equality of men and women, the same rights, in particular: a) The right to work as an inalienable right of all human beings: e) The right to social security, particularly in cases of retirement, unemployment, sickness, invalidity and old age and other incapacity to work, as well as the right to paid leave." This clearly upholds women's right to the same employment opportunities. The gratuity offered to female cabin crew upon their early retirement is meagre and shows a total disrespect towards the years of contribution that they have made towards building the good image of NAS. Therefore, this gratuity policy becomes irrelevant if NAS increases the retirement age of female cabin crew to SS years of age. For example, upon early retirement, a female cabin crew will only receive RN16,000 (This is calculated on the following formula: RN800 x 20 years of service) as a token of appreciation for her 20 years of dedication to NAS. This is contrasted with RN414,000 (for 1S extra years of service, this is calculated on the following formula: (RN2,300 salary per month x 12 months x extra 1S years of service) which she will lose due to her early retirement. !t must be noted that this special gratuity is also subjected to taxation. On the other hand, all male cabin crew are allowed to continue to work till they are SS years of age, with full pay and benefits. !t also makes more economic sense to maintain experienced and welltrained female cabin crew than to spend millions of ringgit on advertisement, recruitment and training for newer and less experienced workers. 2. NATERN!TY LEAvE Existing Employment Conditions The Collective Agreement between the management of NAS and NASEU states that "a married female cabin crew with five or more years of service . shall be granted leave without pay from the date she is declared medically unfit to fly by a medical practitioner. The leave without pay shall commence not later than the end of her second month of pregnancy. She shall not be entitled to medical leave and compassionate leave during the period she is granted leave without pay." Discriminatory Practices i. !t must be stressed that income generated by women is vital for the survival of the family. The denial of seven months' pay in the course of a woman's pregnancy is a violation of worker's right and it does not accord respect and recognition to women's contribution towards the growth and wellbeing of the company. Puman 8esources ManaaemenL | Croup no 4
24 This further perpetuates the stereotype roles that women's contribution is considered secondary to the workforce of NAS. !iFemale cabin crew should not be penalised based on their reproductive function, i.e. to be pregnant and to have children. Such a maternity policy falls short of ensuring an equitable coverage for women and infringes on their effective right to work. Article 11 of CEDAW guarantees that equitable maternity benefit as an inalienable right to all human beings. !t states the following: 1(f). the right to protection of health and to safety in working conditions, including the safeguarding of the function of reproduction, 2. !n order to prevent discrimination against women on the grounds of marriage or maternity and to ensure their effective right to work, State Parties shall take appropriate measures: (a.) To prohibit, subject to the imposition of sanctions, dismissed on the grounds of pregnancy or of maternity leave and discrimination in dismissals on the basis of marital status, (b.) To introduce maternity leave with pay or with comparable social benefits without loss of former employment, seniority or social allowance. !n any Collective Agreement, the terms and conditions should leave workers in a better condition as compared with the Employment Act, 13SS. This means that a worker is guaranteed of all benefits attached to maternity, including her entitlement to full pay during pregnancy. Unfortunately the Collective Agreement between NAS and NASEU provides for employment conditions that are below the acceptable standards as set by the Employment Act, 13SS. 3. TWO SURv!v!NC CH!LDREN Existing Employment Conditions A female cabin crew is only entitled to maternity leave benefits "for not more than two surviving children. !n the event that she becomes pregnant after having two surviving children, she shall resign from the Company, failing which the Company reserves the right to terminate her services." Discriminatory Practices i. Limiting female cabin crew to two surviving children indicates a noncompliance to Section 37 (c) of the Employment Act of 13SS (Act 26S), which states that it is only when a woman has five or more surviving children that she will not be entitled to any maternity allowance. !i The female cabin crew should not be terminated on the basis of having a third child. This policy coerces women to fit into a particular pattern of reproduction. This infringes on women's right to choose and to make their own decision freely and responsibly in terms of the number, spacing and timing of their children.
OUR DENANDS ]oint !nitiative Croup against Cender Bias by the Nalaysia Airline System demands that the Nanagement of the Nalaysia Airlines System revise the employment conditions for female cabin crew with immediate effect. The immediate revisions required are as follows: 1. RET!RENENT ACE To increase the retirement age from 40 years of age at present to SS years of age as currently practiced for men in similar job position. 2. NATERN!TY LEAvE To be entitled to full maternity benefits and this should include full pay, medical leave and compassionate leave during the pregnancy period until confinement. Puman 8esources ManaaemenL | Croup no 4
23 3. TWO SURv!v!NC CH!LDREN To comply with Section 37 (c) of the Employment Act of 13SS (Act 26S) which guarantees a woman the right to full pay and benefits for up to S surviving children.
Signed by: Nalaysia Airline System Employees Union (NASEU) All Women's Action Society (AWAN) Women's Development Collective (WDC) Women's Aid Organisation (WAO) Nalaysian Trades Unions Congress (NTUC) Women's Committee National Council of Women's Organisations (NCWO) Women's Centre for Change (WCC) Sisters in !slam (S!S)
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26 Appendix 2 Letter to the Editor Nalaysian Airlines Discriminatory Retirement Policy 4 ]uly 2003 Women's Aid Organisation (WAO) refers to the comment made by Dr. Nohd Don Abdullah, senior general manager (corporate services) of NAS, with regards to the retirement age for air stewardesses ("NAS: We have reason to hire foreigners", The Star, 30 ]une 2003, Nation 13). Dr. Nohd Don Abdullah stated that NAS had not looked into the retirement age of 40 years (and another five extra year for those in senior positions) because "most women would be expected to be married and have children by then". We believe that Dr. Nohd Don Abdullah and the senior management of NAS would have to find a better justification than that to continue to enforce such early retirement onto their female flight attendants. This discrimination is even more pointed when compared to their male counterparts, where male flight attendants are given the option of retiring at the age of SS. Dr. Nohd Don Abdullahs' statement is in total contradiction to our Covernment's efforts that encourages Nalaysian women to join the workforce and have a retirement age of S0 for women government officials and civil servants. Not only that, the statement is fraught with sexism that places the responsibility of nurturing children only on the shoulders of women. Such understanding harkens to a dinasour era in today's day and age where everyone should recognise that it is the duty of BOTH men and women to care for their children. !t is ironic that recognising the multiple burden of women, NAS has not chosen to provide adequate support for their employees but instead chose to wash their hands off the matter by disqualifying their abilities. Hiding behind the notion of freedom of contract cannot absolve this gender discriminatory attitude. The substantive inequality that NAS' principle of employment provides for should really be seriously looked into by the government to check for violation of Article 8(2) of our Federal Constitution, and of the Convention of the Elimination of All Forms of Discrimination Against Women (CEDAW) that Nalaysia has ratified to in 133S. !n addition, there are millions of women in the workforce who are married and above the age of 40 with children, who have contributed and are continuing to contribute significantly to the Nalaysian society. Naming a few are Datuk Rafidah Aziz, Ninister for Foreign Trade, Datuk Sharizat Abdul ]alil, Ninister for Women and Family Development, and Datuk Dr. Ng Yen Yen, Deputy Finance Ninister. Does this mean then that according to Dr. Nohd Don Abdullah, they should retire because of their age and marital status? !s the senior management of NAS in effect saying that women (who might be married by age 40) are not capable of handling a career and a household at the same time should they choose to? !f not, what is the real reason for the age limit on retirement for air stewardesses? !s it because that by the age of 40, these air stewardesses (women) are not as attractive as they used to be? !f that is the real reason, then this adds another layer of discrimination to the already sexist and ageist statement. NAS should start to value their employees beyond perceived gender stereotypes and instead take a REAL look at these women who are vibrant, intelligent and attractive, and who posses an added advantage experience. !f not, and if such ancient principles are continued to be enforced, NAS might find itself in the precarious position of losing the business of all successful working, career women. Where would it find itself then? Nah XianZhen, !ntern ]aclyn Kee, Communications Officer Puman 8esources ManaaemenL | Croup no 4
27 Appendix 3
MALAYSIAN AIRLINES SYSTEM BHD v. MALAYSIAN AIRLINES SYSTEM EMPLOYEES UNION PENINSULAR MALAYSIA INDUSTRIAL COURT. 1OHOR AWARD NO. 400 OF 2005 [CASE NO: 1/3-16/2004] YUSSOF AHMAD ; EMPLOYER's PANEL: AHMAD SHARIN MOHD NOR ; EMPLOYEE's PANEL: 1AMALUDIN KASIM 26 FEBRUARY 2005 AWARD (NO. 400 OF 2005) This is a trade dispute reIerred to the Court by the Honourable Minister oI the Human Resources under s. 26(2) oI the Industrial Relations Act 1967 ('the Act'). It is in respects oI the demotion oI one Ungku Yacob Ungku Suleiman ('the workman'), a member oI the Malaysian Airlines System Employees Union, Peninsular Malaysia ('the union') by the Malaysian Airlines System Berhad ('the company'). The union is unhappy with the decision oI the company to demote the workman Irom the position oI customer services oIIicer, a Grade C position to the lower position oI customer services agent, a Grade B position. The Iacts are not in dispute. The workman had been guilty oI two charges oI 'blocking seats' without authority by a competent Board oI Inquiry oI the company. The exact charge read as Iollows: That you, as a Customer Services OIIicer oI the Company, on 21 May 2001, at about 0843 hours, at set address 003EA2 Johor Bharu Airport Terminal Building, had blocked seat numbered 025A, 025B and 025C Ior Ilight MH2618/ 21 May 2001 JHB/BKI by using your sign in/check agent code 'HAPD' assigned to you, without authority Irom the Company and in contravention oI the Customer Services Department notice No. 32 dated 19 May 2000 titled 'Seat Blocking Ior Protection Against Overbooking'. This was done in spite oI a previous warning letter dated 13 April 2000 reI JBZ 011 SM1 issued to you Ior a similar misconduct. You have thereby committed an act oI misconduct inconsistent with the IulIilment oI your terms and conditions oI service with the Company by virtue oI Clause 15, Para 15.10, Appendix A oI the Acts oI Misconduct oI the MAS Disciplinary Procedure and such act oI misconduct attracts maior punishment. The eIIect oI the workman's action was that the seats that were blocked by the workman (without authority) were not available to be sold by the company. This would then allow the company's staII at the airport to release the seats at the last minute to the waiting passengers and to upgrade economy class passengers to business class. It was suspected that the staII at the airport could be paid by those passengers involved to get the seats or to be upgraded. The company has previously warned the workman beIore Ior committing the same misconduct. The punishment imposed on the workman was that he was demoted to a lower grade but he did not suIIer a salary reduction. This is not, however, a demotion Irom an executive position to clerical position. The position oI oIIicer in the company did not mean an executive position. Puman 8esources ManaaemenL | Croup no 4
28 At the hearing the workman admitted that he had committed the misconduct but would like to give the reasons why he did it and also he considered the punishment was harsh. In his evidence he explained that he had a good reason Ior doing what he did. His reason was that the company computer booking system was Iaulty in that it showed seats were available Ior sale when actually there was not. These resulted in overbooking and caused problem when some passengers who had conIirmed booking cannot be accommodated as there was in Iact no seats available in the plane. The court was not satisIied on the balance oI probability with the workman's explanation. However, it was satisIied that what the workman did was in breach oI a speciIic instruction not to do this. It is not Ior the workman to use his own discretion to go against the company's instruction. In respect oI the workman's contention that the punishment was harsh in the circumstances the company's evidence was that another employee committing similar misconduct received the same punishment. Learned counsel cited to the Court BR Ghaiye on Misconduct In Emplovment. The learned author wrote 'the right to control employees is a distinguished Ieature oI the contract oI employment. The right to control implies the right to ask the servants what to work (within hours oI service) or what not to work, and to do it. When the employee does certain act which is contrary to his position oI a subordinate, then he is said to be guilty oI insubordination'. This is what the workman did. He was warned not to block seats and he did iust that. It does not matter that he thinks he has good reason Ior doing it. In any event, the court is not satisIied the reason he gave was a good reason. The court is not satisIied by doing what did he prevented overbooking. AIter hearing the evidence and the submission, the court is satisIied that it was proper Ior the company in the circumstances to have demoted the workman to a lower grade without loss oI salary. We even consider that the punishment in the circumstances was rather lenient. The court thereIore dismissed the workman's prayer Ior reinstatement to his Iormer position. * * * * * * Legislation referred to: Industrial Relations Act 1967, s. 26(2) Other source(s) referred to: BR Ghaiye, Misconduct In Emplovment For the companv - T Thavalingam, M/s Zaid Ibrahim & Co For the union - Mustafar Maarof (J Kanagaratnam), Malavsian Airlines Svstem Emplovees Union. Peninsular Malavsia
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29 Appendix 4 PART VIII - EMPLOYMENT OF WOMEN 34. Prohibition of night work (1) Except in accordance with regulations made under this Act or any exemption granted under the proviso to this subsection no employer shall require any female employee to work in any industrial or agricultural undertaking between the hours of ten o'clock in the evening and five o'clock in the morning nor commence work for the day without having had a period of eleven consecutive hours free from such work: Provided that the Director General may, on application made to him in any particular case, exempt in writing any female employee or class of female employees from any restriction in this subsection, subject to any conditions he may impose. (2) Any person -- O (a) who is affected by any decision made or condition imposed under the proviso to subsection (1); and O (b) who is dissatisfied with such decision or condition, may within thirty days of such decision or condition being communicated to him appeal in writing therefrom to the Minister. Puman 8esources ManaaemenL | Croup no 4
30 (3) In deciding any appeal made to him under subsection (2), the Minister may make such decision or order thereon, including the alteration or removal of any condition imposed or the imposition of any further condition, as appears just and such decision or order shall be final. 35. Prohibition of underground work No female employee shall be employed in any underground working. 36. Prohibition of employment by Minister Notwithstanding the provisions of this Part the Minister may by order prohibit or permit the employment of female employees in such circumstances or under such conditions as may be described in such order.
Employment Act 13SS (ACT 2S6) S Regulations, Laws of Nalaysia. Publisher: !nternational Law Book Services
International Labour Organization NATLEX database
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31 Appendix S
!llustration 1.
!shikawa Nodel and competency formula drawn by Nr. Helmi Nokhtar. The !shikawa model is a guidance that is use in NAS to identify the environment and effect and the bones of the fish are the elements that to measure the cause and effect. Another diagram in this picture is the formula to measure the competency and how to measure the men power needed in a period of time. T is the time, R is the raw that are needed, P is the package.
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32 Appendix 6
Our group members with Nr. Abdul Rashid Sharif after the end of 3 hours interview and discussion session. From left, Atikah, Afiq Aqwa, Nr Abdul Rashid Sharif, Nuhd Nazmi, and Nur Fatin.
From left, Atikah, Afiq Aqwa, Nr Abdul Rashid Sharif, Nr. Helmi Nokhtar, and Nur Fatin. Puman 8esources ManaaemenL | Croup no 4
33
Our visit in NAS's Boeing 747 together with a technician. This aircraft is under Ccheck maintenance at Hangar 4.
NAS own Airbus A330. This aircraft is under Ccheck maintenance at Hangar 4. Puman 8esources ManaaemenL | Croup no 4
34 References
N. Sadiq Sohail, (2002), Nalaysia Airlines (NAS) Facing Challenges in the New Nillennium", Case Study Related to Business, vol 1.
Steven H. Appelbaum and Brenda N. Fewster (2007), Contemporary Recruitment and Selection and Diversity and Equal Opportunity Practices", the ]ournal of Clobal Aviation Human Resource Nanagement, volume 21 Number 7 2002.
Women's Aid Organisation, (2000),memorandum ongender bias practices by the malaysia airline system", News, Women's Aid Organisation. 2000.
Laws of Nalaysia. Employment Act 13SS (Act 26S) S Regulations. Part v!!!, Employment of Women. !nternational Law Book Services. Nalaysia. 2002.
!nterviews: %Nr. Abdul Rashid Sharif - Nanager Staff Affairs and Human Resources. Engineering and Naintenance division personal communlcaLlon 24 Narch 2011)
%Nr. Nuhammad Hilmi Nokhtar - Human Resource Controller. Engineering and Naintenance division personal communlcaLlon 24 Narch 2011)
%Nr. Naulan Bardai - Lecturer, UniKL N!AT", personal communlcaLlon 23 Narch 2011, 4 April 2011)