Is It Time For an HR Audit? Probably.

Editor’s Note: This Article Has Been Updated On 8/8/2023

Your HR infrastructure is incredibly important, and we’re not just saying that because our HR people are reading this.

HR people spin a lot of plates, including pay, performance management, training and development, recruitment and onboarding, as well as reinforcing a company’s values. They are the protein of company culture and the bulwark that minimizes lawsuits and regulatory violations.

So it’s important to make sure they’re able to do their best to accomplish those things. That’s where the HR audit comes in.

An HR audit is an examination of your HR department’s health. It’s like a doctor visit in your 40s. Evaluations are conducted, and there are inevitably areas that can use some improvement.

HR audits can also be pretty involved and complex, and chances are good that you’re overdue for one.

The Key Areas of an HR Audit

HR operations cover a lot of functions, so an audit that examines all of those functions at once isn’t super realistic. Instead, you’ll probably have to break down the functions of your HR and prioritize which areas to audit first.

For example, here are some key areas of HR to look at:

Recruitment
Equality & Discrimination
Onboarding and offboarding
Pay & Benefits
Compliance
Training
Leave & Absence
Employee Conduct

The first step to an HR audit is determining which of those key areas should be looked at first. If you’re having problems with recruitment, then that’s a good place to start in your evaluation.

What’s Included in an HR Audit?

After determining which area(s) of your HR department should be looked at first, you’ll need to figure out what you’re actually evaluating. That is, you’ll have to come up with some concrete and objective performance indicators that can be measured to assess your HR’s performance in that area.

The simplest way to do that is to put together a list of questions that reflect what you’re looking to determine about an area of operation.

Let’s use hiring as an example. Let’s say your HR department is having trouble with bringing new people into your company. That’s a problem.

So let’s make a list of questions that can be used to evaluate how HR is doing with the hiring process. They might look something like this:

Who are the employees and/or managers that are involved with each stage of the hiring process?
How many hires have there been in the past 1 or 2 years? How many of those were internal vs. external hires?
How are job openings being advertised? What are the standard application and interview processes?
Is all of the necessary legal information included in the offer letter and non-disclosure agreement?
How much is the size and structure of the business likely to change in the future?

These are just some of the questions that could be asked while conducting a hiring-based HR audit. You’ll surely be able to come up with other questions that are more specific to your company.

By asking these questions, you’ll have answers to seek out. Hopefully, those answers will be helpful in identifying areas that need to be revamped and reworked to improve performance.

Then you’ll have to get everybody on board with cooperating with the audit, including your boss or somebody else’s boss (there will be bosses), and eventually you’ll have to implement all of the changes that need to be made.

Signs that It’s Time For an HR Audit

“But how am I supposed to actually know when we need an HR audit?!” you’re asking. Well, that’s easy. If you haven’t done an HR audit any time recently, then you should probably start working on one.

Sure, maybe your HR department is consistently knocking it out of the park on all fronts. That’s okay, you can still do an audit.

Think back to the doctor’s visit analogy we made up top. You want to go to the doctor for a checkup before you *need* to go to the doctor for a serious problem, right? That way, you can predict impending issues and work to fix them before they become an emergency.

However, there are some signs that you’re overdue for an HR audit.

You’re Worried by Your HR Metrics

So let’s say you’ve noticed a lot of absenteeism lately amongst your employees. Or, even worse, a high turnover rate. Something’s wrong, but you’re not sure what. HR is a good place to start.

An HR audit could help you uncover a deeper underlying problem that’s causing employees to, you know, not want to be employed at your company. Maybe there have been a lot of complaints registered against a manager that went unaddressed, or the basement where you keep your technical writers has an untreated rat infestation that you’ve never even heard about.

Hopefully, digging into your HR for personnel issues should help identify the problem and a way to go about solving that problem. It could also identify why that problem was a problem in the first place.

Regulations Have Changed, but You Haven’t

The rules have a way of changing in the middle of the game, and this is especially true in the wonderful world of GovCon. It’s of the utmost importance to stay in compliance, and that means you need to stay on top of changes in legislation and regulations to keep your company on the up-and-up.

If you’re aware that there has been such a change recently, or you know the details of an impending change, do an HR audit ASAP. Remember, an HR audit today can keep you out of bad circumstances tomorrow.

Your HR Processes Haven’t Caught Up With the Times

Let’s be honest, the times are a’changing. The expectations of much of today’s workforce look a lot different than they did 10, or even just 5, years ago. More people want to be able to telecommute at least part of the time. The standards for benefits and PTO are higher. The tolerance for convoluted interview processes has diminished a bit, and so on and so forth.

Employees don’t stay with one company for decades anymore, especially in GovCon, so you need to keep them engaged and find ways to stand out amongst competitors. Your HR practices need to reflect these evolving expectations of workers.

If you have been experiencing difficulty with recruiting or maintaining employees, then perhaps it’s time for an HR audit to assess whether or not your policies are in-line with modern expectations.

We Can Help With Your HR Audit

At BOOST, HR is one of our specialties. Our HR Services for Government Contractors help find that balance between staying lean to win bids while also attracting and retaining the best talent.

If you think it’s time for an HR audit, whether it’s because you’re facing a problem or just because it has been a while since you’ve done one, contact our HR team today and find out how we can help.

Our team of HR experts are experienced with the ins and outs of navigating the sea of GovCon regulations, and we’ll make sure you’re compliant so you can just worry about doing the things you’re hired to do.

Whether you’re facing recruiting problems, payroll issues, non-compliant behavior from employees, or the need for a total HR overhaul, we’ll be your front line.

About BOOST’s CEO, Stephanie Alexander

Stephanie Alexander has spent more decades than she wants to admit supporting high growth government contractors with an eye towards their bottom line. She is the CEO and founder of BOOST LLC which supports back-office functions for government