S e t- 1

Qu e s t i o n 1 : Explain the process of HR Audit in detail 1101

A n s w e r 1 :

T h e a udi t p r o ce s s

The HR audit process is conducted in different phases. Each phase is designed to build upon the preceding phase so that the organization will have a very strong overview of the health of the HR function, at the conclusion of the audit. These phases include:

Pre-Audit Information: This phase involves the acquiring and review of relevant HR manuals, handbooks, forms, reports and other information. A pre-audit information request is forwarded to the client who compiles the necessary information for review by auditors.

Pre-Audit Self-Assessment: In order to maximize the time spent during subsequent portions of the audit, a pre-audit self-assessment form, if sent to the client can be of use. The self-administered yes/no questionnaire asks a number of questions about current HR policies and practices.

The completion of this self-administered questionnaire allows auditors to identify key areas for focus during the HR audit.

On-site Review: This phase involves an on-site visit at the client’s facility interviewing staff regarding HR policies and practices. A very in-depth HR audit checklist is completed.

Records Review: During the on-site visit, a separate review is conducted of HR records and postings. Employee personnel files are randomly examined as well as compensation, employee claims, disciplinary actions; grievances and other relevant HR related information are checked.

Audit Report: The information gathered is used to develop an HR audit report. The audit report categorizes action needs into four separate areas. The areas that are urgent and important (UI), not urgent needs but important (NUI), not urgent but not important needs (NNI)), and important opportunities needs (I0). As a result of this scheme of classification, managements can prioritize their steps.

The critical areas

The comprehensive HR audit covers all areas of HR management like recruitment practices, training and development, compensation and benefits, employee and union relations, health, safety and security, miscellaneous HR policies and practices-welfare, strategic HR issues, manpower planning/budgeting.

Besides classifying needs in each of the above areas, the HR audit also cites relevant laws, cases and research to support the recommendations.

Preparation for an audit

Auditor engagement: If external firm carrying out the audit, it is preferable to set terms in writing defining and agreeing on scope .If using internal resource, it is better to appoint them formally with clarity on scope and select persons who are non political or those who are not high on hierarchy. Also, if internal persons are auditing there must be training in auditing.

Documents, manuals, handbooks, forms and reports auditor must have access to relevant information contained in employee files and other confidential documents of the organization. Auditors must be given unrestricted access to records, once they sign agreement for confidentiality.

Data gathering: Completion of a self-assessment questionnaire significantly expedites the audit process and allows for better audit planning.

On-site access: The on-site portion of the audit is the most critical.

Qu e s t i on 2: Write a detailed note on Training and Development Audit 1101

A n s w e r 2:

Training andDevelopment

. Individual and departmental Training and Development plans in place and strategically linked to departmental strategic objectives

. A diverse set of training and development activities (e.g. overseas attachment, overseas training, secretariat attachment)

. Training and Development integrated with PMS andSuccession Plan ! Manpower Plan

. Timely induction training provided to all new staff with management training to be provided systematically afterwards

. Regular review of the Training and Development policies

. Evidence of improvement in work quality and efficiency

. Managers’ positive feedback on learners’ performance

. Training courses rated highly in quality and relevance

Importance of Training and Development

6 Optimum Utilization of Human Resources - Training and Development helps in optimizing the utilization of human resource that further helps the employee to achieve the organizational goals as well as their individual goals.

6 Development of Human Resources - Training and Development helps to provide an opportunity and broad structure for the development of human resources’ technical and behavioral skills in an organization. It also helps the employees in attaining personal growth.

6 Development of skills of employees - Training and Development helps in increasing the job knowledge and skills of employees at each level. It helps to expand the horizons of human intellect and an overall personality of the employees.

6 Productivity - Training and Development helps in increasing the productivity of the employees that helps the organization further to achieve its long-term goal.

6 Team spirit - Training and Development helps in inculcating the sense of team work, team spirit, and inter-team collaborations. It helps in inculcating the zeal to learn within the employees.

6 Organization Culture - Training and Development helps to develop and improve the organizational health culture and effectiveness. It helps in creating the learning culture within the organization.

6 Organization Climate - Training and Development helps building the positive perception and feeling about the organization. The employees get these feelings from leaders, subordinates, and peers.

6 Quality - Training and Development helps in improving upon the quality of work and work-life.

6 Healthy work-environment - Training and Development helps in creating the healthy working environment. It helps to build good employee, relationship so that individual goals aligns with organizational goal.

6 Health and Safety - Training and Development helps in improving the health and safety of the organization thus preventing obsolescence.

6 Morale - Training and Development helps in improving the morale of the work force.

6 Image - Training and Development helps in creating a better corporate image.

6 Profitability - Training and Development leads to improved profitability and more positive attitudes towards profit orientation.

6 Training and Development aids in organizational development i.e. Organization gets more effective decision making and problem solving. It helps in understanding and carrying out organizational policies

6 Training and Development helps in developing leadership skills, motivation, loyalty, better attitudes, and other aspects that successful workers and managers usually display.

-Training and Development demonstrates a commitment to keeping employees on the cutting edge of knowledge and practice.

Qu e s t i on 3: Mr. Deshmukh wants to conduct an HR Audit in his organization. He

wants to specifically audit the Employment Practices and Employee involvement.

Suggest what all aspects you may cover in the questionnaire for the audit. Prepare a

questionnaire with at least 15 statements. 1101

A n s w e r 3:

SAMPLE QUESTIONNAIRE # 1

Example of an internal Human Resources Audit: Please amend using questions from

the comprehensive HR Audit to determine the content of your Human Resources

Audit. (Send a copy of this report to the various departments within your Company or

Companies within your Group)

Please complete the following questionnaire as accurately and thoroughly as possible,

attaching relevant documentation where necessary, and return to —————————————— By

no later than ————————————————.

Contact Details

Company Name: Registered As ———————————————————————————————————

Trading As ———————————————————————————————————————————————————

Contact Person: Name: —————————————————————————————————————————

Title: ————————————————————————————————————————————————————————

Contact Numbers: Tel # —————————————————————————————————————————

Fax #: ———————————————————————————————————————————————————————

Cell # ————————————————————————————————————————————————————————

E Mail: ————————————— = ——————————————————————————————————————

Physical Address: —————————————————————————————————————————————

————————————————————————————————————————————————————————————

————————————————————————————————————————————————————————————

Postal Address: ——————————————————————————————————————————————

————————————————————————————————————————————————————————————

Company Details

No1 Yes 1Does the company have a formal Organogram?:

(If yes, please attach. If no, please attach a list of all positions within the

company). Does the company have comprehensive job descriptions for all said

positions?

No (If yes, please attach).1 Yes 1

Employee Head count: Permanent Employees: —————————————————————

Permanent Part-Time Employees: ————————————————————————————————

Contract Employees: ——————————————————————————————————————————

Casual Staff: —————————————————————————————————————————————————

No1 Yes 1Does the Company have a formal HR Manual?

No1 Yes 1Does the Company have a formal HR Filing System?

Does the Company have a computerized HR/Payroll

System? No1 Yes 1HR:

Brand Name: ————————————————————————————————————————————————

Payroll: Yes/No

Brand Name: ————————————————————————————————————————————————

What Records and Control Measures are in place?

Employment Details

(For each category, please indicate if applicable to all employees. If not, please supply details. Further, please indicate whether a policy in regard to that specific category is in place or not and attach same to this document).

Working Hours: Hours per day: ————————— Days per week: —————————————

Working Hours Policy: Yes!No

Overtime: Hours per day: ——————————— Days per week: ———————————————

No1 Yes 1Overtime Policy in Place:

Annual Leave: ——————————————————————— working days leave per annum

Sick Leave: ——————————————————————————— days per year!36 month

cycle Maternity Leave: ————————————————————————————— months per

occasion Family Responsibility Leave: —————————————————————————— per

occasion Study Leave: ———————————————————————————————————— per

examination Unpaid Leave:

———————————————————————————————————————————————— Leave Policy

in Place No1 Yes1: Annual

Sick ! Yes ! No

Maternity ! Yes ! No

Family Responsibility ! Yes ! No

Study ! Yes ! No

Unpaid ! Yes ! No

Remuneration and Benefit Details

(Please indicate whether a policy in regard to each specific category is in place or not and attach same to this document).

If available, please supply a copy of the

following: Letter of Employment or Contract

Pay slip

Induction Programme

Employee Handbook

Certificate of Service

Medical Aid: Name of Fund: —————————————————————————————————————

Company Contribution Details:

———————————————————————————————————

————————————————————————————————————————————————————————————

Pension!Provident Fund Fund type:

Pension!Provident —————————————————————————————————————————————

Name of Fund: ————————————————————————————————————————————————

Company Contribution Details:

———————————————————————————————————

————————————————————————————————————————————————————————————

No1 Yes 1Employment Policy:

How are employees’ salaries?

Packages structured? : ——————————————————————————————————————————

————————————————————————————————————————————————————————————

————————————————————————————————————————————————————————————

Company Vehicle Policy: Yes ! No

Transfer and Relocation Policy: Yes ! No

Retrenchment Policy: Yes ! No

What is the Official Retirement Age of the Company? Male ———————— Years

Female ——————————————————————————————— years

Early Retirement Policy: Yes ! No

Does the Company offer Educational Assistance? Yes ! No

If yes, to whom:

Employees Only

Employees and Employees Immediate children

Other (please specify) ————————————————————————————————————————

Nol Yes lDoes the Company offer any Loan Facilities:

If yes, please indicate:

To whom ———————————————————————————————————————————————————

What Category:(e.g. welfare, home) ———————————————————————————————————————————————————————————————————————————————————————————

Other

(Please indicate whether a policy in regard to each specific category is in place or not and attach same to this document).

Aids & Nol Yes lLife Threatening Diseases Policy:

Nol Yes lDisciplinary and Grievance Procedures:

Harassment & Nol Yes lNon-Discrimination

Policies: Nol Yes lSmoking Policy:

What are the Company’s ratios of employees?

Company Total White Black Male FemaleSenior ManagementMiddle ManagementSupervisoryGeneral Staff

No. of Disabled Employees:

———————————————————— Employment Equity Policy:

Yes ! No

Information Systems

What computer software programmes do you use: ————————————————————

————————————————————————————————————————————————————————————

————————————————————————————————————————————————————————————

Do your employees have their own email addresses: Yes ! No

Do you have a Corporate Website: Yes ! No

If yes, please specify URL: http:!!www

———————————————————————————— How many employees have access to

e-mail facilities within yourCompany !department? —————————————————————————————————————————.

Nol Yes lDo any employees work on a contract

basis: Nol Yes lDo any employees work from home:

Restructuring

Nol Yes lis it likely that your organization or the terms and conditions of employees may be restructured?

Are you famifiar with the requirements of?

The new Basic Conditions of Employment Act: Yes ! No

Employment Equity Act: Yes ! No

Code of Good Practice on Sexual Harassment in the Workplace: Yes ! No

Labour Relations Act 66 of 1995 (as amended): Yes ! No

Skills Development Act: Yes ! No

Code of Good Practice on the Regulation of Working Hours: Yes ! No

Code of Good Practice on Maternity Leave: Yes / No

Do you participate in any Corporate Social Investment schemes: Yes / No

If yes, please specify which organization: ———————————————————————————.

Q u e s t i o nn a i r e S a m p f e # 2

1. Do you comply with federal and state guidelines requiring that certain information must be posted in view of employees and applicants? Yes / No/ Not Sure

2. How is your employee files organized? Do you comply with current EmployeePrivacy regulations? Yes /No /Not Sure

3. Jobs are classified as exempt (salaried) and non-exempt (hourly)? Are youconfident that your job classification system would pass a Dept. of Labor audit if challenged? Yes /No /Not Sure

4. Do you comply with all the Federal and State laws and requirements applicable to your company? Yes /No /Not Sure

5. Are your salaries and wages reasonable, competitive and both externally and internally equitable? Yes /No /Not Sure

6. Do you understand your responsibilities to regularly provide training and/or information to your employees on legally required topics such as IllegalHarassment Prevention, No Discrimination, changes to benefits, changes to company policies and procedures, etc? Yes /No Not Sure

7. Do you have difficulty attracting and/or keeping good, qualified workers? Yes/No /Not Sure

8. Are you confident that your employees are aware of the work rules in your organization covering items such as: attendance, absences, tardiness, theft, intoxication, drug use, insubordination, confidentiality, no harassment, etc? Yes/No /Not Sure

9. Is absenteeism a problem for your organization? Yes /No /Not Sure10. Is the quality of work or customer service in your organization as high as it could

be?

Yes/ No /Not Sure

If you answered “No” or “Not Sure” to any four or more of the Questions, you would benefit greatly from an audit. If you answered No to any one of Questions1, 2, 3 or 4, you would benefit greatly from an audit.