Human resource audits help ensure boost to profit margins

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A recent survey revealed that effectively managing human resources is the No.1 reason businesses make money. Unfortunately, the opposite also is true. |ret||ret||tab|

A regular audit of the human resource function is the solution to ensure proper management and positive results to the bottom line.|ret||ret||tab|

Three key areas must be reviewed:|ret||ret||tab|

Legal compliance. The laws state specific business and anti-discrimination practices, as well as record-keeping re-quirements. Procedures impacted by the regulations include selection, employee handbooks, job descriptions, training, promotions, salary increases, performance evaluations, discipline, terminations, military and medical leaves of ab-sence, layoffs, payroll, benefits and safety.|ret||ret||tab|

Various federal employment laws ap-ply depending upon the size of a company.|ret||ret||tab|

For example, if you have one to 14 employees, a few of the relevant statutes include the Fair Labor Standards Act, Immigration Reform and Control Act, Employee Polygraph Protection Act, Uniformed Services Employment and Reemployment Rights Act.|ret||ret||tab|

The Occupational Safety and Health Act is enforceable for those with at least 11 staff members. The Civil Rights Act of 1964 Title VII, Civil Rights Act of 1991, Title I Americans with Disabilities Act, and Pregnancy Discrimination Act, just to name a few, are applicable if you have 15 or more associates. |ret||ret||tab|

State regulations also must be considered, such as the Missouri Human Rights Act, with language similar to the Civil Rights Act of 1964 Title VII and Title I Americans with Disabilities Act.|ret||ret||tab|

If you have at least six team members, discrimination by race, color, religion, sex, national origin or disability is illegal. If you have laborers in more than one state, you also must follow all laws in the states where they work.|ret||ret||tab|

If you are a federal contractor, be prepared to comply with further statutes. For example, if your federal contract ex-ceeds $10,000 a year, Affirmative Ac-tion-Executive Order 11246 requires re-sults-oriented measures to extinguish employment roadblocks to women and minorities. If you have more than 50 workers and a contract exceeding $50,000, you must develop affirmative action plans with goals and timetables to employ women and minorities.|ret||ret||tab|

Recruiting and selection. The Depart-ment of Labor states the cost to recruit and train a new associate is 35 percent of the first-year salary, and the Society of Human Resource Management believes the cost to be 50 percent.|ret||ret||tab|

To be precise, calculate your direct costs and indirect costs, such as work not produced because time is spent filling positions instead of achieving higher priorities.|ret||ret||tab|

If money is being lost, outsource the function to save revenue. Other measures of success consist of the cost of turnover and each individual's impact on the bottom line.|ret||ret||tab|

Performance evaluations, disciplin-ary actions and terminations. Organiza-tions are wide open to liability due to lack of knowledge by managers and practices that change from one supervisor to the next or from one day to the next.|ret||ret||tab|

One solution is extensive, ongoing management training and subsequent follow-up. Another solution is clear, legal policies and procedures adhered to consistently by managers. |ret||ret||tab|

(Lynne Haggerman is president/ owner of Haggerman & Associates, a retained search, outplacement, in-house management training, and hu-man resources consulting firm specializing in audits.) [[In-content Ad]]