Jetblue Airways: Starting from Scratch Essay

At the beginning, JetBlue management set the tone for themselves that they would be different then other airlines. To do that they set values for all employees from top to bottom to follow and they set up an attractive pay and a unique benefits package that would allow for successful recruitment and retention of employees, while significantly reducing the chance of a union moving into the organization. Equal Employment Opportunity Laws There are certain Equal Employment Opportunity laws that every employer should be aware of and use as guidelines when developing a working relationship with employees and perspective employees. These laws protect employers and employees and enhance the overall association between the two. Three Equal Opportunity laws that impact JetBlue’s hiring practices are: Title VII, Civil Rights Act of 1964, Amended 1972 One of many Equal Employment Opportunity laws, the Civil Rights Act may be the most important law as it prohibits an employer from discriminating against an individual based on race, religion, color, sex, and age. This protection from discrimination covers the areas of â€Å"hiring, firing, promoting, compensation, or in terms, conditions, or privileges of employment.† (Mondy, 2008) Americans With Disabilities Act, 1990 Simply put, this law prohibits employers from discriminating against anyone with a qualified disability. This law establishes that an employer must make reasonable accommodations for a disabled person in the workforce that does not create an undue hardship to the employer. Examples of those accommodations are updating facilities to meet the needs of the disabled employee; adjusting work schedules; and updating equipment that a disabled employee could use. Age Discrimination in Employment Act of 1967, Amended 1978, 1986 This law was created to protect employees over the age of 40 from employment discrimination based on age. The law also prohibits employers from forcing employees into retirement. The Age Discrimination Employment Act applies to both employees and job applicants. JetBlue’s Recruitment Efforts A key internal recruitment effort that JetBlue used was to seek referrals from existing employees. This effort is best illustrated with the pilots. JetBlue set out to hire employees who fit with the organization’s vision and in return they offered employees flexible time, pay and benefits and provided the pilots with updated technology and training. The goal of setting up Values and different employment packages was to show the staff that JetBlue cared about them. This in turn caused employees to be more loyal than at other airlines and soon word-of-mouth spread and people wanted to work for JetBlue. According to Dave Berger, JetBlue COO, â€Å"the happy pilots were a great source for recruiting their friends from competing airlines.† (Hoffer, 2001) Externally, JetBlue placed one classified ad in a Salt Lake City newspaper seeking interested applicants for the position of reservations agents. This â€Å"single local advertisement† resulted in JetBlue hiring over 500 reservations agents and collecting â€Å"a waiting list of 2,500 interested applicants†. (Hoffer, 2001)The one advertisement was so successful because it enticed prospective employees with a flexible work schedule, standard pay with a bonus if they took calls whenever needed, and they provided computers and necessary equipment to the staff members so they could all work from home. JetBlue’s Personnel Selection JetBlue created five Values that would be used to make decisions in all areas of the organization including Human Resources. Those Values are Safety; Caring, Integrity; Fun; and Passion. JetBlue then went into detail with the Values to develop standards of â€Å"desirable and undesirable behaviors† (Hoffer, 2001) and used those standards in asking prospective employees about past behavior. JetBlue set out to hire people who best fit those Values. When interviewing an applicant for a mechanic position, the applicant was asked to recall a time when â€Å"integrity was an issue in his previous employment.† (Hoffer, 2001) The mechanic described a time when he was pressured to sign off that an airplane was ready for an international flight when in fact it was not. The applicant explained he refused to certify the aircraft and was subsequently fired. JetBlue hired this applicant because he fit the Values of the organization. Ann Rhoades, executive vice president human resources, explains that she didn’t offer a prospective pilot a position because of what she perceived as his arrogance. Arrogance doesn’t fit into the Values JetBlue set for its organization. During an interview with a pilot applicant, the pilot was asked to discuss a time when he was encountered with a â€Å"customer request that was in conflict with company polices† (Hoffer, 2001) and explain how he addressed the request. His response was compared to the Values and whether or not it fit into the definition of desirable or undesirable behavior. JetBlue used a method of utilizing multiple interviewers and each of those interviewers had to agree before an offer of employment was made. Utilizing the group interview method, JetBlue was providing those employees on the team a sense of ownership and autonomy which further enhanced employee satisfaction. Three Factors that Influence a Performance Appraisal System When utilizing a performance appraisal system, an organization should be aware of the internal and external factors that influence the outcomes of such appraisals. One example is legislation. Any time an employer is dealing with an employee or potential employee, they must ensure they are not discriminating against any protected class. During the performance appraisal process, the employer needs to have systems in place that assures no discrimination or negative impact of a protected class or group occurs. These are the same requirements described above in the Civil Rights Act; Age Discrimination in Employment Act; and the Americans With Disabilities Act, 1990. Another factor to consider is labor unions. If an organization has a labor agreement with an organized union, they may get push back from the union on the subject of Performance Appraisals. Unions generally encourage pay increases and promotions based on seniority, not on merit. As such, they are known to oppose any type of performance appraisal system. A third factor is completely under the control of an organization and that is corporate culture. The culture within a company can have either a negative or positive impact on the performance appraisal system and is dependent on the attitude from the top down. Employees are likely to not have confidence in the performance appraisal system if the organization does not encourage an environment of high performance, teamwork, and personal development. The lack of support by the organization, builds mistrust by the employees in all areas of human resources. 360-Degree Feedback Evaluation The 360-Degree Feedback Evaluation is used for development of employees and teams and can be helpful in identifying target areas such as building on strengths of an employee or identifying and focusing development needs. By utilizing feedback of an employee’s coworkers, supervisors, and customers, 360-Degree Feedback provides a more balanced evaluation then one that could be influenced by a disgruntled supervisor, peer or customer. The system allows the organization to develop succession plans which is important internally and externally because it gives the employees confidence that the organization has future plans for growth. By using this system, a company can create a professional development and training program that is focused on employee needs, enabling the employee to be successful which in turn, helps the company be successful. Rather than relying on financial goals to measure an employee’s contribution to the organization, JetBlue utilizes the 360-Degree Feedback Evaluation process. JetBlue customized the process calling it the 320-degree feedback process, a play on the name of their aircraft, and uses it to determine whether or not employees are meeting the company’s five core values. Because these core values (safety, caring, integrity, fun, passion) all directly relate to peers, supervisors and co-workers, JetBlue is able to get a direct assessment of each employee’s performance and ability to meet the five core values. Employee-Related Factors Essential in Determining Financial Compensation When addressing the issue of employee compensation, an employer must first evaluate the job by conducting a job analysis to determine the requirements and conditions of the position. Once the analysis is complete, the employer is able to attract and retain qualified individuals. When hiring, it is important to consider the applicant’s experience, performance, skills and competency before determining the right compensation for the future employees. Experience Experience enhances an employee’s performance and is valued by employers. Determining if an employee has valuable insight and basic knowledge of the job is an important variable in establishing compensation. Performance Rewarding employees with pay based on their performance and productivity oftentimes motivates them to do better. Many companies use the merit-based system by rating employee’s performance and increasing pay. Skills Compensation is sometimes based on an employee’s ability to effectively show their ability to perform particular tasks. Competency Competencies are oftentimes associated with an employee’s attitude and values. Many companies find these competencies just as important as skills, education and experience. Discretionary Employee Benefits Discretionary benefits are just that, at the discretion of the company. They are not required by law, but are increasingly just as important to employees as is their pay. Discretionary benefits may include paid time off, profit sharing, and health care benefits. Paid Time Off To provide employees with a work-life balance, time away from work is oftentimes paid through vacation, sick or paid-time-off plans. The time off benefit is usually offered to full-time employees and allows for paid, stress-free rest time that benefits the employee’s mental and physical health. Employee time off also benefits the company because a rested, stress-free employee is more productive then if no time off or unpaid time off had been given. Profit Sharing Profit sharing is a plan that distributes a pre-determined percentage of profits to employees. For those organizations that offer profit-sharing, it is often only offered to full-time employees who have met a vesting period. Profit sharing not only incentivizes employees to meet corporate goals with the goal of achieving maximum profits, but it also benefits the company by valuing long-term loyalty. Health Benefits Having access to affordable health care is a priority for most people and is a great consideration for many when accepting a job. Many full-time and part-time employees receive this benefit from their employer throughout the United States. With the new National Health Care law passed last year, it will now be expected that employers provide some type of health care insurance coverage to their staff if the law is held up in court. JetBlue’s Incorporation of Discretionary Benefits JetBlue is known to provide generous discretionary benefits to all of its employees. These benefits include a flexible work schedule, heath care insurance, paid time off, and 401K plans. JetBlue set out to build employment packages that support the different needs of their employees. In setting up the varying types of discretionary benefits, JetBlue believed it would attract staff and create loyalty. An example is the type of packages offered to the flight attendants. There are several packages for the different types of people who may fill the flight attendant positions. A recent college graduate may not be looking for long-term retirement packages; a family-oriented staff person may be looking for flexible hours and healthcare benefits; and another may be looking for a career in the industry and would require long-term benefits such as a 401K. Each of these individuals would receive a package that is customized to meet their specific needs. The additional benefit of working from home for the reservation agents in Salt Lake City allows the employee flexibility that does not necessarily require them to change their family’s schedules which is a great benefit for many people. REFERENCES: Hoffer, J.G and O’Reilly, C. (2001). JetBlue Airways: Starting from Scratch. Boston: Harvard Business School Publishing. Pp. 58-77 (Hoffer, 2001) Mondy, R.W. (2008). Human Resources Management. Upper Saddle River, New Jersey. Pearson, Prentice Hall. (Mondy, 2008)