An HR compliance audit is an important part of a company’s annual internal audit. HR compliance has always been complicated, and it gets more and more complicated with each passing year, so it’s important to ensure that your HR compliance checklist guides you through carefully examining your internal processes and procedures.
Some government agencies are required to undergo formal HR audits regularly, but businesses of all sizes can benefit from conducting annual audits which review functions and processes essential to conducting business. Utilizing a compliance checklist to guide HR audits helps to keep your business aligned with laws governing employment. This will also ensure that your processes and procedures are producing the desired results, and this will allow you to sustain your business in a way that enhances your reputation both internally and externally.
HR compliance checklists can be quite lengthy and may involve a wide variety of sections and subsections depending on the size of your organization, your industry and other factors, but there are a few key sections that should always be included:
Are you employee files complete? Do you have all needed information for benefits cards, tax documents and other purposes? Your employees may change addresses during the year, add dependents, get married or experience other life changes that impact your record keeping. Make sure you have all updated, correct and current information, and ensure that all insurance and benefits paperwork is complete, as well.
This is the time to review your handbooks and workplace policies. Is your documentation clear? Do your policies need amending or updating? This is the place to talk about everything from the dress code to sexual harassment and bullying. You may need to review your company social media use policy or update your cell phone usage terminology. After updates to all such materials, you need to be sure to issue an updated copy to all employees. Also, make sure all displayed labor law posters are current.
Recruiting and hiring
What are your current processes for recruiting and interviewing new employees? How do you check references? Are you in compliance with current laws? This is the time to review your company’s current offer letter, contracts, orientation processes and training procedures. Are all of your practices compliant with the Americans with Disabilities Act? Do all of your documents ensure that you do not discriminate on any basis? A thorough review will ensure compliance in all areas.
Compensation, benefits and promotions
Of course your company always watches the budget closely, but a complete annual HR compliance review includes a close look at budget and allocations and gives you the opportunity to closely review the payroll schedule and your periodic performance reviews system. Annual – or more frequent – review of your benefits programs allows you to stay abreast of changes and correctly communicate those to staff and make adjustments as needed.
Does your company have a safe and effective system in place for employees to submit feedback and complaints? Do you allow employees to do so in a way that does not cause them to feel that their job or safety in in jeopardy? Employees have the right to provide feedback, and good employers listen carefully and take measured action to ensure the happiness, safety and satisfaction of all employees, within reason.
Health and safety
OSHA (Occupational Health and Safety Act) standards should always be followed in your workplace, especially if your employees handle hazardous materials. Make sure that all employees are properly trained to use these materials, as well as handle spills and dispose of materials. It is also vital that you include a physical inspection of your properties to ensure that health and safety measures are being emphasized and followed for all employees.
HR processes and functions
This category encompasses are very wide variety of functions including but not limited to medical leave, health benefits, unemployment benefits, COBRA, Affirmative Action plans, veteran employees and a variety of other functions. Consult with your HR advisors to ensure that you are up-to-date in these areas, and that your documentation is updated and current to meet your current company size and status and comply with current regulations.
Managing an annual audit can seem overwhelming. If you aren’t sure where to start, consult the experts. Do you need help organizing your HR compliance checklist, annual audit and other HR processes for your organization? Contact the experts at Wild Coffee HR today. We love partnering with companies to help them thrive. It’s what we do.