How to do HR Audit of Organisation : Complete Checklist

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How to do HR Audit of Organisation : Complete Checklist

Many of the articles asked me about how to do HR Audit of a Organisation. So I am providing the HR audit checklist for you all. This HR Audit checklist can be used in  Internal Audit Department of the organisation. Or you can also use it while making HR SOP. If you think i have missed any area then you can comment below or you can also put your queries regarding HR Audit. Because i have done 2-3 HR Audits till now and I can share my experience with you.

HR audit checklist :- 

A MANPOWER REQUIREMENT
Check that details relating to manpower requirement is informed to the management at least well in advance.-
No. of Employees required
Kind of Manpower required ( Skilled / Unskilled
Qualification required ( Graduate/ PG / Professional )
Experienced, Fresher or Trainee
Budget
B Interview
1 Check that interview is taken by the committee appointed for the purpose, comprised of  of at least three members or may be through proper channel like first HR Round then Technical.
One Functional Head or Respective departmental head.
Higher official – Unit Head
One HR Manager or Executive
2 A proper form should be provided by the HR Executive, Which is duly filled by the candidates.
3 The interview is conducted at Unit level or HR Level for the first phase and then short listed candidates are interviewed by the higher management for final phase.
C  Offer  Letter
Offer letter should be given to the selected candidates within 2 -3 days for their acceptance
D After Appointment or Onboarding 
Please Check that :-
1 Appointment letter is given on the date or within 3 days of joining.
2 Employee Information form should be filled and documented within 3 days of joining.
3 Terms and conditions associated with appointment should presents a clear picture.
4 Complete code of conduct should be provided to the candidate who thoroughly reads it
5 Code of Conduct sheet shall be updated on timely basis.
   
E Training & Development 
1 There must be proper training calendar for all employees.
2 Lock-in-period of at least one year on completion of probation/ Training period.
3 Performance Management Document should be present
F Statutory  Compliances Relating To HR :
1 Check for Applicability of various acts and Their due compliance by HR Executive-
 The Apprentices Act,1961
 The Employee’s Provident Fund and Miscellaneous Provisions Act,1952
 The Employee State Insurance Act,1948
 The Factories Act,1948
 The Minimum Wages Act,1948
 The Payment of Bonus Act,1965
 The Payment of Gratuity Act,1972
 The Payment of Wages Act, 1936
 The Trade Union Act,1926
 The Workmen’s Compensation Act
 Factory and Boilers Act
 The Industrial Disputes Act, 1947
 Contract Labour (Regulation and Abolition) Act
 The Industrial Employment (Standing Orders) Act
 Air (Prevention and Control of Pollution) Act, 1981
 Water ( Prevention and Control of Pollution) Act
 The Environment (Protection) Act
 Noise Pollution (Regulation and Control) Rules,2000
 The Personal Injuries (Compensation Insurance ) Act, 1963
2 All the required registers and documents as per above applicable acts should be maintained.
3 Various challans are paid on time. For eg. Challan for PF has to be paid by 15th of next month and Challan for ESI has to be paid by 20th of next month)
4 Consolidated HR records are sent to the HR head for the group including details about all the compliances made by the Company by 20th of   next month in a prescribed format.
G Attendance
1 Daily attendance is taken either in morning or evening in Attendance Register ( Now a days this is done through ERP)
2 Separate register is maintained for daily workers & staff on probation period
2 This register is checked and signed by Executives of two different Department (i.e. by HR Executive and Unit head)
3 Gate pass register should be maintained. Entries relating to all visitors is made in the register and at the end of the day it is verified by Admin department.
H Salary And Wages Procedure
Check that :-
1 Pay scale  and salary structure of the labour & staff should be uniform
2 Calculations of allowances, deductions etc should be according to the provisions and rules .
3 Person making the salary and processing the payment should be different.
4  Salary payment by the first week of next month.
5 Proper workings of salary sheet  should be maintained and its authorisation thereon. If payroll processing is outsourced a proper report should be asked from them.
I Leave Procedures
Leaves taken by employees are classified in Paid, Casual, Sick Should be allowed as per the HR Policy
J Termination or resignation 
Proper notice period should be served by the employee and full and final clearance thereof before resignation/termination as per HR Policy.
k Promotion Management System
1 After completion of at least 12 months of service, promotion or hike in salary  should be done on the basis of performance appraisal and as per management decision.
2 Bonus amount would be calculated depending upon the employee performance and at the decision of the higher management.
3 Employees should submit Self Appraisal Performance Report on quarterly basis to his manager and manager should review the same and transfer it HR Team
4 Employee birthdays, Marriages and anniversaries  should given due consideration and token of gift  should is sent on behalf of the Company.
5 A suggestion or a complaint box should be kept and it is the responsibility of the HR Department to check the same and reporting  the same to the higher management .
L REIMBURSEMENT OF EXPENSES TO EMPLOYEES
Expenses are reimbursed to the employees incurred for official purposes as per the reimbursement policy of the organisation.

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