Thursday, November 19, 2015

What Are HR Audits? (Gary Dessler)

Human resource managers often collect data on matters such as employee turnover and safety via human resource audits. One practitioner calls an HR audit “an analysis by which an organization measures where it currently stands and determines what it has to accomplish to improve its HR function.” The HR audit generally involves reviewing the company’s human resource function (recruiting, testing, training, and so on), usually using a checklist, as well as ensuring that the firm is adhering to regulations, laws, and company policies.

In conducting the HR audit, managers often benchmark their results to comparable companies’. Sample measures (metrics) might include the ratio of HR professionals per company employee. HR audits vary in scope and focus. Typical areas audited include the following:

1. Roles and head count (including job descriptions, and employees categorized by exempt/ nonexempt and full- or part-time).

2. Compliance with federal, state, local employment–related legislation.

3. Recruitment and selection (including use of selection tools, background checks, and so on).

4. Compensation (policies, incentives, survey procedures, and so on).

5. Employee relations (union agreements, performance management, disciplinary procedures, employee recognition).

6. Mandated benefits (Social Security, unemployment insurance, workers’ compensation, and  so on).

7. Group benefits (insurance, time off, flexible benefits, and so on).

8. Payroll (such as legal compliance).

9. Documentation and record keeping. For example, do our files contain information including résumés and applications, offer letters, job descriptions, performance evaluations, benefit enrollment forms, payroll change notices and documentation related to personnel actions such as employee handbook acknowledgments?

10. Training and development (new employee orientation, workforce development, technical and safety, career planning, and so on).

11. Employee communications (employee handbook, newsletter, recognition programs).

12. Termination and transition policies and practices.

Source : Gary Dessler. Fundamental of Human Resource Management. Third Edition. Pearson. 2014

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