Organizations are constantly
evolving. But when it comes to policies and procedures, they often remain
unchanged. To diminish legal issues and to ensure that your company still
complies with the labor and employment laws, it is important to perform an HR
audit. While this sounds daunting, it is a valuable tool that will help your
company stay up to date and able to thrive. In this blogpost, we will show you
how you can effectively use an HR audit. But first, let’s get a better
understanding of what this assessment entails.
What is an HR Audit?
An HR audit is a thorough review of
the policies, procedures, documents, and systems in Human Resources. The
purpose of this audit is to provide recommendations which will help you improve
operations and performance. Usually, HR professionals perform the assessment.
However, companies can also choose to hire an external company to conduct the
audit.
What are the Benefits?
Whether the focus lies on policies
or performance, HR audits uncover problems and challenges that exist within the
department. Evaluating these issues will allow your company to improve and
reduces the risk of litigations. It will also have a positive effect on the
employees, knowing that the company takes an active role in bettering the
working conditions. These positive changes will lead to an effective way of
working and an increased employee morale.
How to Perform an HR Audit?
Although there are many different
ways in which companies can utilize HR audits, most assessments follow the same
structure. The HR audit consists of three parts. The first step is the
pre-audit. During this phase, you will have to collect data. This information
can be quantitative or qualitative, depending on the point of interest. The
next step is the analysis of the data. Here you will assess the relevant
information such as processes, procedures, policies, documents, and data. The
final step is to draft a report that contains your findings and recommendations
which will help improve the Human Resources department.
Considering the time and effort that
you need to invest in a full-scale assessment, it is advisable to perform one
HR audit per year. When you make an assessment, you can choose to focus on the
following areas:
· Recruitment
· Onboarding
· Management
· Training and
Development
· Employee
Relations
· Performance
· Strategic
Planning
· Documentation
· Best
Practices
· Compliance
with Laws and Regulations
Checklist to Effectively Conduct Your HR
Audit
Before starting the assessment, you
can create a checklist to stay organized and efficient throughout the auditing
process. This list contains detailed questions that apply to the different
areas of Human Resources and is typically a couple of pages long. You can break
down the audit into smaller assessments by dividing the questions, which will
make it easier to complete. Additionally, you can decide the format of the
checklist.
You
can choose to answer “yes” or “no” to questions or allow a more detailed answer.
Management
- Are the HR goals aligned with the organization?
- Are the workweeks clearly defined?
- Are the working hours clearly defined?
- Is there an open form of communication between HR and other departments?
Recruitment
- Does each position within the organization have a job description?
- Are the job descriptions up to date?
- Are job openings offered to current employees?Is the employee turnover rate monitored?
Onboarding
- Do new employees receive a contract and handbook?
- Are the on-boarding documents up to date?
- Do new employees receive the right training?
- Do new employees have follow up meetings?
Employee Relations
- Does your organization have a system for performance appraisal in place?
- Are your practices in line with your policies?
- Do the policies and procedures comply with the federal rules and regulations?
- Is there a clear and well communicated process in place for receiving and handling employee complaints/issues?
Training and Development
- Are employees provided with trainings?
- Are employees provided with opportunities to further develop their skills?
- Are the provided trainings and opportunities within budget?
- Do employees receive ongoing feedback?
Documentation
- Do all employees have a personnel file?
- Are the personnel files up to date?
- Are documents kept for the required duration?
- Does the organization comply with the General Data Protection Regulation (GDPR)?
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