HR Audits: What, Why, and How

Conducting the Human Resources Audit
Strategic HRD


What keeps you awake at night?

HRD Audit


eliminate liabilities. ensure compliance with employment law. implement best practices and educate your managers. HRD Audit 3 .What is an HR audit? An HR audit is a process to review implementation of your institutions policies and procedures.

The audit should be: Proactive Reactive Informative Developmental HRD Audit 4 .

Why conduct an HR audit? • Ensure compliance • Improve HR practices • Train your managers • Prepare for potential government audit or litigation • Gain an understanding of department’s environment • Show a “good faith effort” • Correct errors HRD Audit 5 .

Audit Tools: • Interview • Document review • Questionnaire • Sampling HRD Audit 6 .

What is the audit ‘testing’? • Compliance with employment law • Compliance with institution policies/procedures • Training opportunities • Department environment • Potential liabilities • Accuracy of records • Manager’s understanding of law/policies/procedures HRD Audit 7 .

Will they publicly support the process? HRD Audit 8 . External 2. Are they ready to fix what’s broken. even if it costs $$$$? b. Internal vs. Do they agree with the methodology? c. Will they allow access to all departments/information? d. Secure senior management commitment. Determine who will conduct the audit.Before you begin the audit process… 1. a.

What audit tools will you use? d. Who will get the results? HRD Audit 9 .Before you begin the audit process… 3. How will results get reported? f. How will the process be rolled out? e. What do you want to audit? c. a. Define the parameters. Who will be audited? b.

Before you begin the audit process… 4. HRD Audit 10 . Introduce the audit process to your managers.

procedures. To avoid costly and time consuming litigation HRD Audit 11 . To gain a better understanding of their department d. To protect them and the institution b. and laws c. To help them understand policies. a. Explain the reason for it.How do you introduce the HR audit to your managers? 1. To help them set best practice procedures e.

How do you introduce the HR audit to your managers? 2. If you have an intranet. HRD Audit 12 . Give them a copy of the questions before the interview. post the questions on it.

Departmental Audits What should you be concerned about? Record Keeping •Sick and vacation tracking Employee Files •What is and isn’t in the employee file •Access to the file •Overtime reporting •FMLA application •Safety and security of the files •Temporary worker tracking •Accessibility/safety/security of records •Accuracy of records HRD Audit 13 .

Departmental Audits What should you be concerned about? (cont’d) Manager’s Understanding of Policies/Practices •How to handle complaints of harassment •How to calculate/report overtime •Difference between exempt and non-exempt •Giving employment references •Affirmative Action requirements •FMLA •Consistency applying policies and procedures HRD Audit 14 .

Reporting the Results • Compile your findings in a draft letter • Allow department head/manager to review your draft and make comments/corrections • Compile final version • Present report to senior management • Copy department head/manager HRD Audit 15 .

The findings are not negotiable! HRD Audit 16 . Allowing a department head and or manager to review your draft is not a license for him/her to change your findings.Remember….

compliant.What should your memo contain? • Recognition of department’s cooperation (or lack of it) • State the facts – avoid opinions • Document areas that need attention • Document areas where department was proactive. practiced good judgment • “Suggestions” on how to correct problem areas • Time line for follow-up • Offer Human Resources’ assistance HRD Audit 17 .

nonexempt status •Employees are correctly graded •Job descriptions are available for all position or grade categories •Limited access to systems/records •Social Security numbers are secure and only used when necessary HRD Audit 18 •Compliant with HIPPA •Paying correct rates .Don’t forget to conduct an audit in your own (Human Resources) department! Benefits •No phantom participants Compensation/Payroll •Correct use of exempts vs.

Review… Employee Relations •Correct documentation of investigations •Warning/disciplinary letters Training and Development •Programs are readily available to staff •Tracking attendance •Policies and procedures are readily available to staff •Required posters are visible to staff •Sick and vacation tracking is accurate HRD Audit 19 .

I9.Review… Records Employment/Recruitment •Employee files are kept in safe and secure area •Limited access to files •Staffing and selection paperwork •Affirmative Action forms •Posting information •Necessary paperwork is readily available (job description. investigatory documents) HRD Audit 20 . medical records. application. W4. emergency contact) •Certain records are kept separate from employee file (references.

Thank you! HRD Audit 21 .

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