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How do you know if your business needs an HR Audit & Operational Review?

Quick! Answer this: Is your business’ human resources doing what it needs to do?

If this question A. threw you off, B. was answered with “I don’t know”, or C. made you stop and think for a few minutes, we’d like to talk to you about HR audits and operational reviews.

Truth is, most business owners are too busy, well, owning their business to keep up with human resources. (Hey, we’re not blaming anyone here. The business laws & HR trends change so quickly, it’s a full-time job just keeping up! Trust us, we know.)

But keeping up with human resources is important. At its best, a human resources function is productive, aligned with your business strategy, and provides measured results. At its worst, human resources can cost your business money, employees and lawsuits.

So how do you know where your human resources falls? A good way to check in is to get an HR audit. HR audits and operational reviews look at your human resources practices, policies and procedures and tell you what’s working and what’s not.

Not sure if your company needs an HR audit and operational review? Let’s take a look at some of the warning signs.

You may need an HR Audit and Operational Review if…

1. You’re worried you might not be up-to-date with legislation

Did our talk about being too busy to keep up with legal trends hit a little close to home? Again, we don’t blame you: It’s easy to let other things slip through the cracks when you’re occupied with handling your business. Unfortunately, not being up-to-date can cost your business. An HR audit will look into this area and determine how compliant your business is.

2. Your turnover has been steadily increasing

If a lot of your employees have been saying goodbye and leaving for other jobs, it could be one of many potential issues. An HR audit can help you determine what is driving away your top performers.

3. You open your employee handbook and moths fly out

We’ve mentioned many times just how important an employee handbook is to your business. We’ve also mentioned how laws change (Are we annoying you about that, yet?) We mention it a lot for a reason – Without proper policies set in handbooks, your business is at risk for an employee-relations lawsuit or other related issue. An HR audit can tell you what is missing and what needs updating in your handbook, helping you reduce those risks.

4. A manager or other untrained employee is in charge of HR administration

In small and medium-sized businesses, supervisors, managers and even CEOs play a number of roles. Sometimes managers or other employees find themselves doing HR administration. But what happens if that person isn’t properly trained? They could be putting the company at risk or handling things inappropriately without even knowing it. HR audits can dig into how HR administration is handled typically provide recommendations for how to improve processes/procedures.

5. Your company is not attracting or retaining new hires

Is your business putting out more job ads than it is receiving resumes? Do you find that most of your recent hires quit within 6 months? An HR audit can help you determine what isn’t working in regards to recruitment, onboarding and employee retention, helping you gain and keep the best people.

Did we scare you with these points? If any of these rang true for your company, you really should consider getting an HR Audit & Operational Review.

Of course, there are several reasons for needing an HR audit. These do not cover them all.

Visit our HR Audit & Operational Review page to learn more about our HR audit services, what areas we look into, and how we can help improve your business’ HR function.

 

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about the author: Amy Letke

Amy Newbanks Letke, SPHR, GPHR, is the Founder of Integrity HR, Inc. Amy provides workplace solutions to improve performance, reduce liability and increase profits. She is passionate about helping other entrepreneurs and business owners achieve success.