Importance of the Human Resource Audit for a Company

 

Introduction

Every organization main objective was to maintain the organizational goal according to their Business plan. To review the HR department progress HR audit is key function of a company.

The scope of HR Audit includes the implementations of HR policies and also ensure to apply it on organization, it’s concerned with compliance and legal review-however most of the organizations not having the proper HR function as they don’t have clear strategy to run the organizations and to get the best possible ways for effective results (Amy, 2010).

 

Importance of HR AUDIT

Human Resources Audit that help the organization achieve its business goals and objectives, An HR Audit can help to ensure legal and compliance review while measuring the effectiveness of HR programs (Judith, 2012).

Purpose of HR Audit

• ·         Ensuring compliance of the company's working with the governing laws
• ·         Helping the HR Department understand how to improve itself
• ·         Reviewing and the proper resource allocation for human resources
• ·         Being an act of "due diligence" for potential investors and stakeholders of a company
• ·         A basis for improvements in the future

 Global context of HR audit in Samsung

Samsung Electronics’ compliance programs focused on three key areas. The highest priority on the prevention of compliance risks through identifying changes in the legal environment and employee training. In addition, we conduct regular & irregular monitoring, and analyze the results of responding to identified issues to prevent any recurrence of risks.

 Source ; Samsung sustainability report 2016

Few examples of the most common types of HR

•     I-9 audit
•     Policy or handbook audit
•     Co Wage and hour practices audit
•     Exemption audit
•     Job description audit
•     Safety audit
•     Functional audit

According to the Sadhana (2017) follow mentions areas have been identified as a major steps of HR Audit.

• ·         Briefing and orientation
• ·         Scanning material information
• ·         Surveying employees
• ·         Conductive interviews
• ·         Synthesizing
• ·         Reporting

As a leading telecommunication company in Sri Lanka, ABC company also doing the HR audit to review the HR department performance. Reputed outsource HR audit company carried out the audit and its report handover to CEO of the ABC company. At the period HR Manger and team have big responsible to support the conduct the audit without any obstacle.

In recent audit report of ABC Company highlighted the training and development and health safety policies that not align with the plan. Hence training development process was rearranged and increased the training quantity and methods align with telecom industry. As well as to improve the health and safety policies brought a new guideline and special insurance scheme considering the job category wise.

Conclusion

Human resource audit denotes people and the processes that are responsible for efficient working in organizational functions and protect the company money by identifying and correcting inefficiencies and compliance problems.

 

Source: You tube

 

References

Amy, L. (2010). Improving your organization with the integrity HR audit. Retrieved from http://www.youtube.com/watch?v=WhWDWgy27M0

Judith Brown (2002).Conducting an HR Audit: How HR Can Better Measure the Effectiveness of its Functions and Programs

Anon., 2016. SAMSUNG SUSTAINABILITY REPORT, s.l.: s.n.

Sadhana Kumari, 2017. An Emerging Tool of Human Resource Management. International Journal of Business Administration and Management, 7(ISSN 2278-3660), p. 225.