Human Resource Audit

An HR audit proposal is a proposition forwarded to check whether the company is following the organisation’s own rules, regulations and the state labour laws regarding recruitment, remuneration, job evaluation, performance appraisal, compensation, employee welfare, motivation and corporate strategies. It helps the company to reach its objectives and also to study the effectiveness of the HR functions.

An audit is a means by which an organization can measure where it currently stands and determine what it has to accomplish to improve its human resources function. It involves systematically reviewing all aspects of human resources, usually in a checklist fashion, ensuring that government regulations and company policies are being adhered to. The key to an audit is to remember it is a learning or discovery tool, not a test. There will always be room for improvement in every organization.

Why Do An Audit

  • To insure the effective utilization of an organization’s human resources.
  • To review compliance with a myriad of administrative regulations.
  • To instill a sense of confidence in management and the human resources function that it is well managed and prepared to meet potential challenges.
  • To maintain or enhance the organization’s and the department’s reputation in the community.
  • To perform a "due diligence" review for shareholders or potential investors/owners. 

What does a full HR Audit entail?

  • Legal compliance
  • Compensation/Salary Administration
  • Employment/Recruiting
  • Orientation
  • Terminations
  • Training and Development
  • Employee Relations
  • Communications
  • Files/Record Maintenance/Technology
  • Policies and procedures (including employee handbook)
  • Communications and Employee Engagement

Consulting Audit Process

  1. On-site Interview conducted with HR personnel, managers and others who are familiar with and responsible for various HR activities.
  2. Records Review of a cross-section of employee personnel records for appropriate documentation and fulfilment of record keeping requirements.
  3. Document Review of HR related forms, policies & procedures, employment contracts, job descriptions and related documents for ease of use and consistency with HR best practices as they relate to employment law.
  4. Report Preparation which summarizes your current practices, identifies any areas of concern, and provides recommendations for change.
  5. Report Presentation – to present the report findings, explain concerns and recommendations, and discuss strategies to address the concerns.


Consultant need to obtain brief from client and thereafter submit a (RFQ) based on the need of the organization and the number of consulting days to be determined. Together with this consultant will submit a plan of action towards how many man days are required to undertake this project and the project cost