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Here are your three options for doing an HR audit

by , 06 February 2015
With all the labour law changes and hefty fines for non-compliance, it's become more vital than ever to ensure your HR practices comply with changes in the laws.

To avoid these crippling fines, you want to conduct an HR audit. But what if you don't know how to go about it.

Well, we've got good news for you.

There are three methods you can use to do an HR audit. Read on to find out what they are...

Here are the three methods you can use to conduct HR audits

1. Audit the entire HR function
With this method, you audit all areas of your HR department including:
  • HR documents and records, for example, contracts of employment, how you structure salaries, performance review records, training records, etc;
  • Policies and procedures. This includes your workplace rules; and
  • Practices. For example, do you actually follow the specific rules, regulations and guidelines in your company's policies.
This method is time consuming and it can take months to complete the audit. Make sure you plan for it well in advance. This because people in your HR department have to step away from their jobs to take part or give information to whoever's doing the audit.

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Avoid penalties from the DoL by making sure HR is fully aligned to the new labour laws!
Along with the changes to the labour law, you are required to:
  • Make sure your HR policies and procedures are appropriately aligned to labour legislation;
  • Check that your company guidelines are being adhered to by your managers and employees;
  • Check the level of compliance within the company; and
  • The areas and level of risk there is in terms of non-compliance within your company.
With the recent labour law changes and the hefty increases in penalties for non-compliance, it has become more critical than ever to ensure that HR is fully aligned to the changes in the laws.
Find out how to eliminate the risk of a crippling fine from the Department of Labour.

2. Audit a specific area of HR
This method involves you auditing just a section or two of your HR department.
You can randomly choose one or two areas to audit, for example, complaints about how you hire new employees.
Just like the first one, this method can be time consuming. Overall, it depends on the size and scope of the HR area you're auditing.
The good thing about it is it helps you minimise disruption because, by auditing one or two areas, you don't slow down all your HR services. Other HR areas can continue unaffected.
3. Do small audits on a regular basis
Here, you audit one area of HR at a time. For example, your audit could involve weekly audits to make sure attendance registers are in order.
You would then check a different division of your business every week to see if they complete and submit their attendance registers on time. This then allows you to take immediate action to make sure those who don't comply will do so in future.
This method has minimal disruption and isn't resource intensive, but it does require your ongoing and regular focus.

While the method you use to conduct an HR audit is important, it's even more crucial to consider these five points…

  1. What you'll be auditing;
  2. The time the audit is likely to take;
  3. The available resources you have to do the audit;
  4. The likely disruption in HR, other areas of your business and how to deal with them; and
  5. The level of expertise you need to do the audit.
Now that you know your options, choose an HR audit method that suits your business so you can comply.
PS: There's one more method you can use to perform and HR audit. You can find the details in the HR Audit Electronic Report as well as a step-by-step action plan for conducting an HR audit.

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