HR Audit

What is HR Audit?

An HR Audit is the process of evaluating the human resource department’s performance, activities, and policies directed towards achieving organizational goals. It is conducted to identify the shortcomings and suggest remedies for the betterment of HR functions. An HR audit can either be partial, where only a few aspects are monitored, or comprehensive, where complete human resource monitoring is carried out. The two components of HR audit include:

• Evaluation of HR policies - recruiting, benefits, employee-relation, salary, training.
• Review of HR indicators - turnover, satisfaction, grievances, legal complications, safety

The importance of these two components is to eradicate legal risks and identify areas where value can be added to attract and retain top talents.

Frequently Asked Questions

What are the reasons behind conducting an HR audit?

Organizations conduct HR audits to ensure that the activities and work going on are correct and fair. It provides them with factual and essential information, which is then compared to the set standard. As a result, the gaps are easily identified, and measures can be taken to improve the key areas.

What benefits does an HR audit give to the organization?

An HR audit brings multiple benefits to the organization. Some of them are:

• Identify and analyze the gaps in departments.
• Ensure that the organization is working in a compliant manner.
• Reduces the unnecessary costs of HR departments.
• Encourages and appreciates top performers.

What is the HR audit checklist?

A human resource audit checklist is a document that contains information about all things that need to be audited for various divisions. Companies generally, before conducting audits, prepare a checklist to maintain the order and ensure any area to audit is not left.

At what time intervals should an audit be conducted?

There is no specific time interval for conducting audits. Organizations, as per their needs and audit areas, can conduct it. However, in-depth audits are time-consuming, and therefore they are generally performed on an annual basis. In comparison, general areas can be audited at regular monthly intervals.