Lisa Kennis-Miller is the Founder and President of HR Rescue Resources, LLC, a human resources consulting firm for small to medium sized companies. Follow her on Facebook. For $50 OFF a 1 hour consultation, please visit www.HRRescueResources.com
Ignoring this important
business process could allow your competition to surpass you. It could mean
the difference between losing your business as a result of regulatory
non-compliance fines and lawsuits OR you could recognize vulnerabilities,
correct them, and blow your competition out of the water!
Tax season is upon us. As we all scramble to file our taxes and bring financial order to our lives, (but mostly to AVOID penalties and fines from the IRS) let us not forget to look at other areas of the business. This is where a Human Resource Audit (HR Audit) comes in. Whether you have an 'HR Department' or not doesn't matter. What does matter is that your company takes an intense objective look at its policies, procedures, and practices once a year, every year. This comprehensive assessment will help in identifying areas in which changes need to be made. Results of the audit will reveal gaps in policies and practices, which then can be an area to focus efforts to minimize lawsuits, fines, and other potential violations. The last thing you want is a government agency knocking on your door announcing they are there to do an audit of your employment practices!
There are four
types of HR audits.
1. Compliance (How is the company complying with
laws and regulations),
2. Best Practices (Helps the company maintain a competitive
advantage by comparing its practices with those of companies identified as
having exceptional HR practices),
3. Strategic (Focuses on strengths and weaknesses of
systems and processes to determine whether they align with the company's
strategic plan), and
4.
Function-Specific (Focuses
on a specific area in the HR function (e.g., payroll, performance
management, records retention, etc.).
HR Audits serve many
purposes. They:
- Identify areas of legal risk, sources of lawsuits, and
regulatory non-compliance.
- Identify issues, find solutions to problems before they
become unmanageable.
- Determine how processes could be done differently/more
efficiently.
- Tell if your business is compliant with State, Federal,
and Local laws.
- Show what procedures/processes are you missing.
- Establish best practices in the industry.
So remember, doing an HR
Audit is similar to getting your car inspected or getting a physical. You
pay a relatively small amount up front to get diagnostics and a list of suggested
services that should be completed to 'keep the car running' or to 'stay
healthy'. If you take the advice and get the services or preventive care
suggested, then you should expect relatively no problems until the next
appointment. If you choose not to do what is suggested, there can be dire
consequences!
