It’s no secret that planning is an important practice for business owners. One element of planning that is essential to a company’s policies, practices, and procedures is the HR Audit. An HR Audit can help identify if specific practice areas and processes are adequate, legal, and effective, and whether they are helping or hindering the business overall. The Audit will assess the compliance of policies and procedures and diagnose issues before they become problems. Additionally, an audit will identify what you’re doing right, identify gaps, recommend how to improve inefficiencies, and even reduce costs by remediating issues before they implode.HR Audits help accomplish multiple objectives: 

  • Ensure legal compliance in all functional areas
  • Identify gaps in processes and skills
  • Establish efficient documentation
  • Detect misclassification of wage and hour practices
  • Reveals issues relating to leave time and attendance
  • Recognize strengths and weaknesses in recruiting, onboarding and exits
  • Reduce exposure to unknown and potential discriminatory practices
  • Adopt a positive climate for ongoing improvements as part of the culture

Areas of the business that are most often examined in the audit include: 

Compliance. Review of the organization to ensure compliance with current federal, state, and local laws and regulations.

Strategic. Focus on strengths and weaknesses of systems and processes to determine if they are in alignment with the organization’s strategic plan.

Functional. Examine specific areas within the HR function: payroll, performance management, records retention, hiring practices.

This is a competitive world under the confines of regulation.  When to conduct an audit is not an exact science and should never be done in panic-mode but rather when there are discussions for management or staffing changes, merger or acquisition, potential growth, new plans, or other significant change.  Often times, business owners simply need a good gauge on their HR and business practices as a “check-up”, and an audit is the best way to get this done. 

Not conducting an audit leaves businesses exposed as a result of the unknown festering taking place behind the scenes of which a business owner may not even be aware.  This festering turns into lost production and revenue.  An HR audit is a cathartic and very eye-opening exercise, revealing gaps and serving as an excellent benchmark, especially when united with a new strategic plan, management or staffing change.

Upon the completion of the HR Audit, an Internal Audit Report will provide an accurate and thorough picture of the status of the company, recommendations for improvement, with a roadmap toward a healthier foundation, and better engaged employees.  Ultimately, these fixes provide for a good night’s sleep.

At CornerstoneHR, we believe that every business deserves a solid foundation. For us, that’s more than a marketing slogan – it is the principle that we strive to provide to every client we represent. And that foundation begins with an HR Audit – it paves the way for a business to operate with confidence and success. 

If you believe that your company will benefit from what an effective and comprehensive HR audit will provide, then let’s talk. Together, we’ll fortify your business with a plan for renewed HR health. 

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