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4 key indicators that signal it might be time for an HR Audit

KKM Leadership 8 January 2024


Woman sitting at her computer looking frustrated
Is it time for an HR audit?

Here we are - the year 2024 - and the year kicked off at a very rapid pace! I can barely keep up with my own "to do" list which makes me wonder how organizations are managing to adapt in this ever-changing terrain of business trends and priorities.


Introduction

Amidst the continuous transformations in the world of business, the foundational elements of policies, practices, and procedures often remain untouched. To mitigate legal risks and ensure ongoing compliance, the imperative of conducting regular HR audits cannot be overstressed – a crucial step, especially in the context of the challenges posed by remote work.


While the term "audit" may carry a sense of trepidation, it is, in reality, a valuable process that fosters organizational resilience. An HR audit involves a meticulous review of policies, procedures, documentation, and HR systems, yielding recommendations aimed at enhancing operational efficiency, HR programming, and overall organizational performance.


In this blog, we delve into 4 key indicators that signal it might be time for an HR Audit.


Hand holding a wooden block with HR written on it

4 Key Indicators that signal it might be time for an HR Audit


1. Transition in HR Leadership: A change in leadership within the HR function presents an opportune moment to scrutinize employment policies, practices, and procedures. This is crucial for several reasons, especially with the added layer of remote and hybrid workforce challenges:


  • Incumbents may inadvertently rely on outdated practices, impeding organizational progress, exacerbated by the dispersed nature of remote work.

  • Employment laws evolve, and staying abreast of these changes ensures ongoing compliance, a task complicated by remote work scenarios.

  • Organizational needs prompting the HR transition, particularly those associated with remote work dynamics, can be identified through an HR audit.


2. Excessive Turnover: Elevated turnover rates, particularly within specific departments or roles, serve as a red flag indicating underlying organizational issues. An HR audit can pinpoint the root causes, considering the remote work landscape, which might include:


  • Insufficient career development opportunities and recognition, complicated further by the challenges of remote or hybrid workforce engagement.

  • Inconsistencies in maintaining a healthy work-life balance, exacerbated by the blurred boundaries between work and personal life in remote setups.

  • Managerial unfairness impacting staff satisfaction, particularly challenging to identify and address in a remote or hybrid work environment.


3. Significant Organizational Growth: Substantial organizational growth necessitates recalibrating compliance needs. Employment laws may come into effect at critical employee count milestones, such as the Family and Medical Leave Act (FMLA) when reaching 50 employees.


Additionally, the cultural shifts accompanying growth require updated practices to accommodate diverse employee needs, including those arising from remote work scenarios. HR audits prove instrumental in identifying necessary policy adjustments and recognizing outdated or missing practices, especially in the context of the dispersed workforce.


Team reviewing compliance information on their laptops
Policies, procedures, and practices are studied during a HR Audit

4. Organizational Changes: Shifts in the business model, downsizing, or mergers and acquisitions all signal potential impacts on employee dynamics, highlighting the need for HR audits. These transformative events necessitate a thorough review of policies, practices, and procedures to ensure alignment with the evolving organizational landscape, with remote work considerations integrated into the evaluation.


Conclusion

Proactively pursuing HR audits becomes even more critical for organizations navigating the complexities of the contemporary business environment. These complexities are further compounded by leadership and HR turnover, organizational right-sizing and other transformations, as well as the ongoing challenges of remote and hybrid work environments.


By addressing red flags promptly and embracing the insights gained from audits, organizations can fortify their foundations and propel themselves towards sustained success in the era of remote work.

 

Contact us today to learn more about our comprehensive approach to HR Compliance Audits - start the year off with the right information and set your organization up for sustainable success!

 

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