Cambridge IGCSE and O Level Business Studies Section 2 People in business
Exam-style case study 2a answers
The answers have been written by the authors and aim to provide a summary of appropriate content for answering each question.
However, the suggestions provided are not intended to be a definitive guide to all acceptable answers; each response should
be assessed on its own merits. Marking guidance for case study questions has been provided in the answers document for
case study 1a. This can be used as a basis for marking this case study. Please note, the way marks are awarded may differ in
examination to the guidance provided in this resource.
Case study 2a: Snax Plc
Question 1a Explain two benefits to Snax Plc of contracts of employment.
Possible answers could Relevant points
include: • it is a legal requirement
• avoids misunderstanding if there is a dispute
• employers and employees know the terms and conditions of the employment
Sample explanation
It is a legal requirement, so Snax Plc has to provide all the 350 production workers with a contract
setting out details, such as the hours and when they are to be paid; this should stop the chance
of disputes arising which could lead to a stoppage in the production of crisps. If the employer
does not provide a contract, it could lead to fines/legal action which would increase costs.
Question 1b As well as contracts of employment, there are other legal controls on the recruitment and
employment of workers. How might each of these laws affect Snax Plc? Justify your answer.
Possible answers could Minimum wage laws • workers have right to be paid for work they do – pay at minimum
include: wage – so unless large increase limited impact
• would increase business costs – may not be able to afford to pay
all 350 workers – so make some workers redundant/replace with
machinery
Health and safety laws • laws to protect employees – ensure protective clothing provided
• if employers do not provide safety equipment and the worker is
injured during crisp production they can sue for compensation –
company can also get fined for not complying with the law
• increases business costs – as will need to train workers to use
machines safely as well as purchase equipment
• could reduce number of accidents – increasing productivity/output
Anti-discrimination laws • have to have equal opportunities policies in place – takes time and
money to set up
• could have to give job back and pay compensation if unfairly
dismissed
• if workers feel unfairly treated they may leave – many are leaving –
could help reduce recruitment costs
• widen pool of ideas/skills – leading to more varied ideas and views
Conclusion • minimum wages – as current level of pay meets law – limited impact
• health and safety – increases costs – impact on profitability and
prices – so likely to have most effect as cannot avoid
• anti-discrimination policies can benefit business as more ideas –
help compete – policies do not necessarily increase costs
© Cambridge University Press 2018 Exam-style case study answers – 2a
Cambridge IGCSE and O Level Business Studies Section 2 People in business
Question 2a Explain one advantage and one disadvantage of off-the-job training.
Possible answers could Advantages
include: • other workers not affected
• workers have access to skilled trainers
• workers do not learn bad habits
• workers focus 100% on training
Disadvantages
• expensive
• not necessarily tailored to individual company
• workers are training rather than working
Sample explanation
Other workers not affected so the remaining from the 350 employees are able to focus on
production, which could help increase/maintain output. If not, Snax Plc would not be able to
keep up with demand, leading to a reduction in sales for its crisps and other snacks.
Question 2b Explain three reasons why training of workers is important for Snax Plc. Justify your answer.
Possible answers could Decrease amount of • less supervisors – lower costs of pay
include: supervision • help motivate some of the 350 employees – as do not feel being
watched as much
Decrease chances of • fewer errors – less rework required as fewer wasted resources –
mistakes lower costs
• higher output of crisps – able to meet demand
• better quality – could improve reputation of its snacks – increase
demand/sales
Increase opportunity for • increase motivation – so fewer employees leave – which is
internal promotion current problem
• increase pool of internal candidates – easier to find employees
with knowledge of business so lessens requirement to recruit
external candidates
Conclusion • supervision – help lower costs – but this is not main issue – high
turnover and waste issues
• mistakes – concern over high level of waste – but workers highly
trained so impact may be limited in cooking division
• opportunity for promotion – high labour turnover – and have to
recruit external candidates – could save time – reducing need for
induction training
Question 3a Other than increasing hourly wage rates, identify two financial incentives that Snax Plc could
consider paying to its employees in the Preparation division.
Possible answers could Relevant points
include: • bonuses
• performance related pay
• share ownership scheme
© Cambridge University Press 2018 Exam-style case study answers – 2a
Cambridge IGCSE and O Level Business Studies Section 2 People in business
Sample explanation
Share ownership may encourage the employees to think about how to make the business more
productive, such as reducing the level of waste as they will directly benefit from any increase in
profit or improvements in quality. Furthermore, it does not add to costs of running the business,
as payment comes out of profits.
Question 3b Explain the following non-financial incentives. Which one would be the best for the Factory
Manager to use in order to reduce labour turnover in the Preparation division? Justify your
answer.
Possible answers could Job rotation • workers switch jobs – more interesting/not as boring as doing
include: the same thing – improve motivation
• cost of training workers to do different jobs
Quality circles • workers have first-hand knowledge of issues – solutions likely to
be more effective – can save time and money
• takes longer as time in group meetings (350 employees) could
be used working – lower output
• can help motivate employees as given responsibility – which
could help reduce problem of workers leaving
Team working • employees have ownership of work – increases motivation
• relies on workers being able or willing to cooperate – as not
everyone may be team workers
• unequal participation – could lower overall productivity so fewer
crisps/snacks produced
Recommendation • employees may not want extra responsibility of team working so
lower output not increase motivation
• how easy is it to switch jobs without additional training costs – if
work is not interesting will not help improve motivation
• employees must feel that solutions offered are listened to
otherwise could demotivate rather than motivate
• depends on reasons why employees leaving – is it work, pay or
responsibility? – may need to see results of questionnaire
Question 4a Explain the purpose of two documents that the human resources department might send to
someone interested in applying for a vacancy at Snax Plc.
Possible answers could Relevant points
include: • job description
• person specification
• application form
Sample explanation
Job description outlines the tasks and responsibilities that will need to be carried out as part of
the specific job. Applicants will know what the job involves and if they are suitable to apply. This
reduces the chance of wasting Snax Plc’s time by applying for an inappropriate role. This allows
the human resources manager to draw up a job specification with suitable skills required, so he
can focus on resolving the labour turnover issue.
© Cambridge University Press 2018 Exam-style case study answers – 2a
Cambridge IGCSE and O Level Business Studies Section 2 People in business
Question 4b State the advantages and disadvantages of the following methods of recruitment. Which
would be the most appropriate for Snax Plc to use to fill a vacancy for a supervisor in any of the
three factory divisions? Justify your answer.
Possible answers could Internal recruitment • saves time and money – cheaper than external recruitment
include: • can be motivating – as others see chance for promotion – so
fewer employees leave, helping solve another problem
• person is already known – so no need for induction training,
saving time
• may need training – increases costs
External recruitment • new ideas about how to make crisps or reduce amount of
wastage
• already skilled/trained to correct level reduces costs of training
• person does not know the organisation and how it works
• person not known
Recommendation • employees may want chance for promotion so could lower
labour turnover – have knowledge but do not feel valued but
better candidates may be the ones who have left Snax Plc
• new employees may take time to adapt and be able to bring in
new ideas to help improve productivity and quality but existing
employees might have ideas from quality circle but not had
opportunity to implement
© Cambridge University Press 2018 Exam-style case study answers – 2a
