The  HR  Audit:  A  Periodic  Review  of  Your  HR  Prac6ces  

Nancy  Edwards  

Before  we  get  started…  

•  I  am  not  an  aAorney  •  This  material  is  not  legal  advice  •  This  presenta6on  is  not  a  subs6tute  for  experienced  legal  counsel  

Why  An  HR  Audit  

Why  Do  a  Compliance  HR  Audit  

•  Proac6ve  -­‐  Catch  errors  before  a  governmental  agency  does  (i.e.  DOL,  EEOC)  

•  Poten6ally  reduce  the  risk  of  lawsuits  

What  is  an  HR  Audit?  

•  A  means  of  assessing  the   level  of  compliance  with  federal  and  state  laws.  

•  A  means  of  measuring  the  effec6veness  of  your  HR  policies  and  prac6ces.  

•  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  organiza6on.  

Poll  Ques6on  

Does   your   company   currently   conduct   yearly   HR  Audits?  

What  does  an  HR  Audit  include?  

•  Compliance  and  Recordkeeping  •  Compensa6on/Salary  Administra6on    •  Employment/Recrui6ng    •  Termina6ons    •  Files/Record  Maintenance/Technology    •  Employee  Rela6ons    •  Training  and  Development    •  Communica6ons      •  Policies  and  Procedures  (including  employee  handbook)  

The  HR  Audit  Process  Includes:  

•  Management  Interviews  (informal)  •  Issues  that  require  immediate  aAen6on  •  Management  skill  levels  •  Resistance  level  

•  Employee  Interviews  (informal)  •  Cross  sec6on  of  all  employees  •  Employee  issues  (i.e.  morale,  reten6on)  •  Company  has  no  obliga6on  to  adopt  all  sugges6ons  

The  HR  Audit  Process  Includes:  

•  Document  Review    •  Legal  compliance  •  Recordkeeping  requirements  •  Efficiency  and  effec6veness  •  Consistency  

•  Employee  Handbook  Review  •  Legally  compliant  •  Clear  communica6on  •  Nondiscriminatory  and  appropriate  •  Viola6ons  properly  documented  

The  HR  Audit  Process  Includes:  

•  Review  Current  and  Poten6al  Legal  Ac6ons  •  Mee6ng  legal  requirements  •  Improved  management  training  •  Revision  of  policies  and  prac6ces  

Problems  Iden6fied  and  Correc6ve  Ac6on  

•  Findings  •  Applicable  laws  and  prac6ces  •  Penal6es  and  risks  •  Recommenda6ons  

Ac6on  Plan  

• Must  be  realis6c  and  achievable  • Desired  results  must  be  iden6fied  •  Assign  accountability  •  Target  dates  

Wage  &  Hour  

Exempt  Employees  

•  Execu6ve  •  Administra6ve  •  Professional  • Outside  sales  •  Some  computer  professionals  •  Salary  of  $455  per  week  

Exempt  Employees  cont’d  

•  Fewer  rights  under  FLSA  •  Receive  full  amount  of  base  salary  in  work  period  (less  any  permissible  deduc6ons)  

• May  be  required  to  punch  a  clock  • May  be  required  to  make  up  missed  6me  • May  work  unlimited  number  of  hours  

Non-­‐Exempt  Employees  

• Must  be  paid  at  least  $7.25  for  the  first  40  hours  worked  in  a  week  (check  specific  state  laws  for  higher  minimum  wage)  

• Must  receive  over6me  rate  of  at  least  6me  and  one-­‐half  their  regular  rate  of  pay  for  all  hours  worked  over  40  in  a  workweek  (check  specific  state  laws  for  more  stringent  requirements)  

•  Cannot  waive  their  rights  to  over6me  

Non-­‐Exempt  Employees  

• May  be  paid  on  an  hourly  basis,  a  salary  basis  or  piece  rate  basis  as  long  as  they  receive  at  least  minimum  wage  for  all  hours  worked  and  the  appropriate  over6me  

• Must  have  a  6mekeeping  mechanism  •  Private  sector  –  NO  COMP  TIME!  

Independent  Contractors  

•  Self-­‐employed  • Not  just  one  customer/has  customer  base  •  Responsible  for  own  taxes  and  expenses  • No  employer  direct  control  • No  benefits  

FLSA  -­‐Liability  

• WHD  review  prior  2  years  •  3  years  if  willful  •  Possible  criminal  prosecu6on  •  Li6ga6on  

Recordkeeping/Non-­‐Exempt  

•  Name  •  Address  •  Social  Security  Number  •  DOB  •  Gender  •  Job  6tle  •  Time  and  day  of  week  when  employee’s  workweek  begins  •  Hours  worked  each  day  •  Total  hours  for  each  workweek  

Recordkeeping/  Non-­‐Exempt  

•  Basis  on  which  employee’s  wages  are  paid  (e.g.  “$10  per  hour”)  

•  Total  daily  or  weekly  straight-­‐6me  earnings  • Over6me  worked  and  paid  • Deduc6ons  • Wages  for  each  pay  period  • Date  of  payment  and  pay  period  covered  by  payment  

Recordkeeping  /  Exempt  

•  Name  •  Address  •  Social  Security  Number  •  Date  of  Birth  •  Gender  •  Occupa6on  •  Time  and  day  of  week  on  which  the  employee’s  workweek  begins  

•  Total  wages  paid  for  each  pay  period  •  Date  of  payment  and  the  pay  period  by  each  payment  •  PTO  

Personnel  Files  

Personnel  Files  

Personnel  Files  

• What  should  be  in  a  personnel  file?    •  Employment  

•  Employment  Applica6on  /  Employment  Offer  •  Handbook  Acknowledgment  •  Resume  •  Performance  Reviews  •  Training  and  Development  Documents  •  Termina6on  Form  •  Job  Descrip6on  •  Exit  Interview  

Personnel  Files  

• What  should  be  in  a  personnel  file?  •   Benefits  

•  Vaca6on  Request  •  Request  for  Non-­‐Medical  Leave  of  Absence  •  Tui6on  Reimbursement  Documents  

Personnel  Files  

• What  should  be  in  a  personnel  file?  •  Payroll  

•  W-­‐4  form  •  Timesheets  •  AAendance  Records  •  Garnishment  Orders  •  Authoriza6on  for  Payroll  Deduc6ons  •  Compensa6on  History  Records  •  Status  Change  Documents  

Personnel  Files  

• What  should  be  in  a  personnel  file?  •  Employee  Rela6ons  

•  Report  of  Coaching/Counseling  Sessions  •  Commenda6ons,  Awards  •  Disciplinary  Documents  

Personnel  Files  

• What  should  NOT  be  in  a  personnel  file?  •  Medical  Records  

•  Physical  Examina6on  •  Diagnos6c  Records  •  Lab  Results  •  Drug  Tes6ng  Results  •  Any  other  medical  records  with  personally  iden6fiable  informa6on  about  the  employee  

Personnel  Files  

• What  should  NOT  be  in  a  personnel  file?  Inves6ga6on  Records  

•  Accusa6ons  of  legal  and/or  policy  viola6ons  •  Discrimina6on  complaints  and  inves6ga6on  

•  Clearance  Inves6ga6on  Records  •  Background  check  informa6on  (including  criminal  history,  credit  history)  

•  Opinions  •  Notes  on  documents  indica6ng  management  bias  or  discrimina6on.    For  example,  “He  is  too  old  for  the  job.”  

Reten6on  and  Storage  

•  Varies  depending  on  document  

•  Follow  Federal  Record  Reten6on  Guidelines  

• Hardcopy  Storage  

•  Paperless  Storage  

• Destroying  Documents  

Job  Descrip6ons  

Job  Descrip6ons  

• What  should  a  job  descrip6on  include?    •  Job  Title  •  Department  •  FLSA  Status  (exempt,  nonexempt)  •  Job  Type  (regular,  seasonal,  temporary,  etc)  •  Job  Status  (full  6me,  part  6me)  •  Travel  Required  •  What  posi6on  this  posi6on  reports  to  •  Work  Schedule  

Job  Descrip6ons  

• What  should  a  job  descrip6on  include?    •  Posi6on  Summary  •  Essen6al  Func6ons  •  Posi6on  Qualifica6ons  •  Skills,  Abili6es  (educa6on,  computer  skills,  experience,  etc.)  

•  Physical  Requirements  (standing,  sinng,  lioing,  speaking,  bending,  etc.)  

•  Work  Environment  •  Signature  Lines  

Job  Descrip6ons  

•  Job  descrip6ons  •   Determine  the  essen6al  func6ons  of  the  job  

• Useful  when  dealing  with  unemployment  claims  

• Helpful  when  measuring  performance  •  Should  accurately  describe  the  job  

Job  Descrip6ons  

•  Recommenda6ons  •  Review  your  job  descrip6ons  on  a  periodic  basis  •  Update  your  job  descrip6ons  when  essen6al  func6ons  for  a  posi6on  changes  

•  Contact  your  G&A  Partners  HR  Advisor  for  assistance  

Conclusion  

•  Learning  and  discovery  tool,  not  a  test  •  There  will  always  be  room  for   improvement  in  every  organiza6on  

•  Contact   your   G&A   Partners   HR   Advisor   for  more  informa6on  

•  Sources  •  www.dol.gov  •  www.prospera.com  •  www.twc.state.tx.us  

 

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