HR AuditGreen Wind Solutions

HR Audit

HR audit is an overall quality control check on human resource activities in a division or company and how those activities support the organization’s

strategy. A human resource audit evaluates the personnel activities used in an organization. The

audit may include one division or entire company.

Purpose The purpose of a Human Resources audit is to

assess the effectiveness of the Human Resources function to ensure regulatory compliance

To look for potentially serious problems (Time bombs)

To find areas needing improvement To document processes for use in merger,

reorganization or inspection To address compliance issues

Benefits Identifies the contribution of the personnel

departments to the organization Improves professional image of the personnel

department Encourages greater responsibility and professionalism

among members of the personnel department Clarifies the personnel department’s duties and

responsibilities Finds critical personnel problems Create an HR business plan Streamline HR work processes Monitor compliance with established regulations and

procedures Develop user-friendly HR systems

Feed Back1. The function of operating managers. 2. The human resource specialists.3. How well managers are meeting their human

resource duties.

Scope Audit of Corporate StrategyCorporate Strategy concerns how the organization is

going to gain competitive advantage. Audit of the Human Resource FunctionAudit touches on Human Resource Information

System, Staffing and Development, and Organization Control and Evaluation. Audit of Managerial ComplianceReviews how well managers comply with human

resource policies and procedures. Audit of Employee SatisfactionTo learn how well employee needs are met.

Corporate Strategy Human resource professionals do not set

corporate strategy, but they strongly determine its success.

By assessing the firm’s internal strengths and weaknesses and its external opportunities and threats, senior management devises ways of gaining an advantage, such as :

stresses superior marketing channels, low-cost production, etc. Understanding the strategy has strong

implications for human resource planning, staffing, compensation, employee relations, and other human resource activities

Human Resource Function

Human Resource Information System- Human Resource Plans : Supply and

demand estimates; skill inventories; replacement charts and summaries

- Job Analysis Information : Job standards, Job descriptions, Job specifications

- Compensation Management : Wage, salary, and incentive levels; Fringe benefit

package; Employer-provided services

Staffing & Development Recruiting : sources of recruits, availability of

recruits, employment applications Selection : selection ratios, selection

procedures, equal opportunity. Training and development : orientation program, training objectives and procedures,

learning rates Career development : internal placement,

career planning program, human resource development efforts

Organization Control & Evaluation

Performance appraisals : standards and measures of performance, performance appraisal

techniques, evaluation interview.

Labor-Management Relations : Legal compliance, management rights, dispute resolution problems.

Human Resource Controls : employee communications, discipline procedures, change

and development procedures,

Methodology Interview key staff Review relevant documentation Help you complete a comprehensive

questionnaire Compile data a prepare and customized written

report Make specific recommendations to improve the

efficiency and performance of your HR function

Regulatory Compliance Audit Personnel files and record keeping

(contain only job related information) Pay equality Job descriptions (ADA compliance) Health and safety Equal opportunities and positive action Forms (applications, internal forms, etc.) Legal reporting Policies and procedures

Task of Auditors Identify who is responsible for each activity. Determine the objectives sought by each

activity. Review the policies and procedures used to

achieve these activities. Prepare a report commending proper

objectives, policies, and procedures. Develop an action plan to correct errors in each

activity. Follow up the action plan to see if it solved the

problems found through the audit.

Audit of Employee Satisfaction Employee satisfaction refers to an employee’s

general attitude toward his or her job. When employee needs are unmet, turnover, absenteeism, and union activity are more likely. To learn how well employee needs are met, the

audit team gathers data from workers. The team collects information about wages, benefits, supervisory practices, career planning

assistance, and other dimensions of job

Report for the HR Specialist The specialists who handle employment

training, compensation, and other activities also need feedback. Such feedbacks are :

1. Unqualified workers that need for training2. Qualified workers that need for development3. What others company are doing4. Attitude operating managers toward

personnel policies5. Workers pay dissatisfaction