HR Glossary

HR audit

When the law and procedures are out of touch with everyday life, it becomes expensive and risky. A personnel audit works like a flashlight in a dark archive: it reveals gaps in files, errors during work, inaccuracies in salaries, forgotten GDPR clauses. It's not a "witch hunt", but putting things in order before the control does. What does such an audit include and when is it worth doing it?

HR audit – what is it and what does it consist of?

A HR auditi a detailed analysis of an organization’s activities in the area of HR and HR processes, aimed at checking compliance with applicable labor law regulations and assessing whether the personnel policy supports the achievement of business goals. In practice, a HR audit means not only checking documents, but also analyzing HR and payroll processes and assessing their effectiveness.

There are several types of audits: HR and payroll audit, employee documentation audit, employment legalization audit or internal audit concerning the correctness and effectiveness of activities in the HR department. Each of them allows the organization to make sure that the processes carried out are in accordance with applicable regulations and at the same time effective.

Employee Records Audit Compliance

One of the key areas is the audit of employee documentation. It consists in verifying the compliance of the documentation with the applicable regulations. For m.in example, personnel files, working time, attendance lists, contracts, as well as work regulations and internal policies are subject to analysis.

The aim is to check whether the regulations and procedures are compliant with the provisions of the labour law. A professional HR audit detects irregularities in the management of HR documentation, indicates the risks associated with errors and suggests corrective actions.

HR and payroll audit and its importance

Another important element is the HR and payroll audit, which includes the analysis of HR and payroll processes and checking the correctness of payroll calculation. For m.in example, the compliance of remuneration with contracts, compliance with the rules on working time or the rules for calculating salaries are checked.

A HR audit carried out in this area allows to increase transparency and reduce legal risks, as well as to improve the efficiency of HR and payroll processes. Thanks to this, the organization can be sure that its activities are carried out in a manner compliant with the law and safely.

Scope of service and internal audit

The scope of the audit service may cover various areas: from the analysis of employee documentation, through the evaluation of remote work procedures, to the quality control of processes in relations with internal customers. Typically, the audit takes place in several stages:

analysis of documents and procedures,
conversations with HR employees,
assessment of the compliance of activities with the applicable law,
preparation of a report containing the results of the inspection,
preparation of recommendations for improvements.

The audit report allows the management to make the right decisions and, if errors are detected, to implement corrective actions.

Benefits of HR audit

A well-conducted audit brings many benefits to the organization:

ensures the correctness of HR and payroll processes,
minimizes the risk associated with external controls,
allows you to adapt policies and procedures to changes in the law,
improves HR processes and human resource management,
supports the achievement of business goals of the entire company.

A HR audit is not only a document control, but also a tool supporting human resources management. Analysis of employee documentation, assessment of HR and payroll processes and checking their compliance with applicable legal regulations allow us to build stable foundations of HR policy. Ultimately, HR audit is a way to mitigate risk, increase transparency, and better align HR activities with the needs of the entire organization.

Author of the article

Dawid Rabczuk