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	
  ad...
Why	
  An	
  HR	
  Audit	
  
Why	
  Do	
  a	
  Compliance	
  HR	
  Audit	
  
•  Proac6ve	
  -­‐	
  Catch	
  errors	
  before	
  a	
  
governmental	
  a...
What	
  is	
  an	
  HR	
  Audit?	
  
•  A	
  means	
  of	
  assessing	
  the	
  level	
  of	
  compliance	
  with
	
  
fed...
What	
  does	
  HR	
  Audit	
  Include	
  
• 
• 
• 
• 
• 
• 
• 
• 
• 

Compliance	
  and	
  Recordkeeping	
  
Compensa6on/...
The	
  HR	
  Audit	
  Process	
  Includes:	
  
•  Management	
  Interviews	
  (informal)	
  
•  Issues	
  that	
  require	...
The	
  HR	
  Audit	
  Process	
  Includes:	
  
•  Document	
  Review	
  	
  
•  Legal	
  compliance	
  
•  Recordkeeping	
...
The	
  HR	
  Audit	
  Process	
  Includes:	
  
•  Review	
  Current	
  and	
  Poten6al	
  Legal	
  Ac6ons	
  
•  Mee6ng	
 ...
Problems	
  Iden6fied	
  and	
  Correc6ve	
  Ac6on	
  
•  Findings	
  
•  Applicable	
  laws	
  and	
  prac6ces	
  
•  Pena...
Ac6on	
  Plan	
  
•  Must	
  be	
  realis6c	
  and	
  achievable	
  
•  Desired	
  results	
  must	
  be	
  iden6fied	
  
•...
Wage	
  &	
  Hour	
  
Exempt	
  Employees	
  
•  Execu6ve	
  
•  Administra6ve	
  
•  Professional	
  
•  Outside	
  sales	
  
•  Some	
  comput...
Exempt	
  Employees	
  cont’d	
  
•  Fewer	
  rights	
  under	
  FLSA	
  
•  Receive	
  full	
  amount	
  of	
  base	
  sa...
Non-­‐Exempt	
  Employees	
  
•  Must	
  be	
  paid	
  at	
  least	
  $7.25	
  for	
  the	
  first	
  40	
  
hours	
  worke...
Non-­‐Exempt	
  Employees	
  
•  May	
   be	
   paid	
   on	
   an	
   hourly	
   basis,	
   a	
   salary
	
  
basis,	
   ...
Independent	
  Contractors	
  
•  Self-­‐employed	
  
•  Not	
  just	
  one	
  customer/has	
  customer	
  base	
  
•  Res...
FLSA	
  -­‐Liability	
  
•  WHD	
  review	
  prior	
  2	
  years	
  
•  3	
  years	
  if	
  willful	
  
•  Possible	
  cri...
Recordkeeping/Non-­‐Exempt	
  
• 
• 
• 
• 
• 
• 
• 
• 
• 

Name	
  
Address	
  
Social	
  Security	
  Number	
  
DOB	
  
G...
Recordkeeping/	
  Non-­‐Exempt	
  
•  Basis	
  on	
  which	
  employee’s	
  wages	
  are	
  paid	
  
(e.g.	
  “$10	
  per	...
Recordkeeping	
  /	
  Exempt	
  
•  Name	
  
•  Address	
  
•  Social	
  Security	
  Number	
  
•  Date	
  of	
  Birth	
  ...
Personnel	
  Files	
  
Personnel	
  Files	
  
•  What	
  should	
  be	
  in	
  a	
  personnel	
  file	
  	
  
•  Employment	
  
• 
• 
• 
• 
• 
• 
...
Personnel	
  Files	
  
•  What	
  should	
  be	
  in	
  a	
  personnel	
  file	
  
•  	
  Benefits	
  
•  Vaca6on	
  Request...
Personnel	
  Files	
  
•  What	
  should	
  be	
  in	
  a	
  personnel	
  file	
  
•  Payroll	
  
• 
• 
• 
• 
• 
• 
• 

W-­...
Personnel	
  Files	
  
•  What	
  should	
  be	
  in	
  a	
  personnel	
  file	
  
•  Employee	
  Rela6ons	
  
•  Report	
 ...
Personnel	
  Files	
  
•  What	
  should	
  NOT	
  be	
  in	
  a	
  personnel	
  file	
  
•  Medical	
  Records	
  
• 
• 
•...
Personnel	
  Files	
  
•  What	
  should	
  NOT	
  be	
  in	
  a	
  personnel	
  file	
  
cont’d	
  
•  Inves6ga6on	
  Reco...
Reten6on	
  and	
  Storage	
  
•  Varies	
  depending	
  on	
  document	
  
•  Follow	
  Federal	
  Record	
  Reten6on	
  ...
Pos6ng	
  Requirements	
  
Pos6ng	
  Requirements	
  
•  Federal	
  Requirements	
  
• 
• 
• 
• 
• 
• 

Fair	
  Labor	
  Standards	
  Act	
  (FLSA)	
...
Pos6ng	
  Requirements	
  
•  State	
  of	
  Texas	
  Requirements	
  
•  Texas	
  Workers	
  Compensa6on	
  No6ce	
  
•  ...
Pos6ng	
  Requirements	
  
•  Compare	
  federal	
  and	
  state	
  laws	
  to	
  your	
  
company	
  policies.	
  
•  Use...
Conclusion	
  
•  Learning	
  and	
  discovery	
  tool,	
  not	
  a	
  test.	
  
•  There	
  will	
  always	
  be	
  room	...
Contact	
  info	
  
Nancy	
  Edwards,	
  SPHR	
  
G&A	
  Partners	
  
	
  
713-­‐784-­‐1181	
  
info@gnapartners.com	
  
	...
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Hr audit presentation Dec 2013

  1. 1. The  HR  Audit:  A  Periodic  Review   of  Your  HR  Prac6ces   Nancy  Edwards  
  2. 2. 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  
  3. 3. Why  An  HR  Audit  
  4. 4. Why  Do  a  Compliance  HR  Audit   •  Proac6ve  -­‐  Catch  errors  before  a   governmental  agency  does  (i.e.  DOL,  EEOC)   •  Poten6ally  reduce  the  risk  of  lawsuits  
  5. 5. 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.  
  6. 6. What  does  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)  
  7. 7. 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  
  8. 8. 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  
  9. 9. The  HR  Audit  Process  Includes:   •  Review  Current  and  Poten6al  Legal  Ac6ons   •  Mee6ng  legal  requirements   •  Improved  management  training   •  Revision  of  policies  and  prac6ces  
  10. 10. Problems  Iden6fied  and  Correc6ve  Ac6on   •  Findings   •  Applicable  laws  and  prac6ces   •  Penal6es  and  risks   •  Recommenda6ons  
  11. 11. Ac6on  Plan   •  Must  be  realis6c  and  achievable   •  Desired  results  must  be  iden6fied   •  Assign  accountability   •  Target  dates  
  12. 12. Wage  &  Hour  
  13. 13. Exempt  Employees   •  Execu6ve   •  Administra6ve   •  Professional   •  Outside  sales   •  Some  computer  professionals   •  Salary  of  $455  per  week  
  14. 14. 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  
  15. 15. Non-­‐Exempt  Employees   •  Must  be  paid  at  least  $7.25  for  the  first  40   hours  worked  in  a  week  (check  specific  state   law  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  law  for  more  stringent   requirements)   •  Cannot  waive  their  rights  to  over6me  
  16. 16. 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!  
  17. 17. Independent  Contractors   •  Self-­‐employed   •  Not  just  one  customer/has  customer  base   •  Responsible  for  own  taxes  and  expenses   •  No  employer  direct  control   •  No  benefits  
  18. 18. FLSA  -­‐Liability   •  WHD  review  prior  2  years   •  3  years  if  willful   •  Possible  criminal  prosecu6on   •  Li6ga6on  
  19. 19. 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  
  20. 20. 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  
  21. 21. Recordkeeping  /  Exempt   •  Name   •  Address   •  Social  Security  Number   •  Date  of  Birth   •  Gender   •  Occupa6on   •  Time  of  day  and  day  of  week  on  which  the  employees   workweek  begins   •  Total  wages  paid  for  each  pay  period   •  Date  of  payment  and  the  pay  period  by  each  payment   •  PTO  
  22. 22. Personnel  Files  
  23. 23. 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  
  24. 24. Personnel  Files   •  What  should  be  in  a  personnel  file   •   Benefits   •  Vaca6on  Request   •  Request  for  Non-­‐Medical  Leave  of  Absence   •  Tui6on  Reimbursement  Documents  
  25. 25. 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  
  26. 26. Personnel  Files   •  What  should  be  in  a  personnel  file   •  Employee  Rela6ons   •  Report  of  Coaching/Counseling  Sessions   •  Commenda6ons  and  Awards   •  Disciplinary  Documents  
  27. 27. 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  
  28. 28. Personnel  Files   •  What  should  NOT  be  in  a  personnel  file   cont’d   •  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.”  
  29. 29. Reten6on  and  Storage   •  Varies  depending  on  document   •  Follow  Federal  Record  Reten6on  Guidelines   •  Hardcopy  storage   •  Paperless  storage   •  Destroying  documents  
  30. 30. Pos6ng  Requirements  
  31. 31. Pos6ng  Requirements   •  Federal  Requirements   •  •  •  •  •  •  Fair  Labor  Standards  Act  (FLSA)   Occupa6onal  Safety  and  Health  Administra6on  (OSHA)   Polygraph  Protec6on  Act   Equal  Employment  Opportunity  (EEO)   Family  and  Medical  Leave  Act  (FMLA)   Uniform  Services  Employment  and  Reemployment   Rights  Act  (USERRA)  
  32. 32. Pos6ng  Requirements   •  State  of  Texas  Requirements   •  Texas  Workers  Compensa6on  No6ce   •  Texas  Payday  Law   •  Employer  No6ce  of  Ombudsman  Program   •  Texas  Child  Labor  Laws   •  Texas  Equal  Employment  Opportunity  
  33. 33. Pos6ng  Requirements   •  Compare  federal  and  state  laws  to  your   company  policies.   •  Use  as  guide  when  crea6ng  company   policies.   •  Place  posters  in  a  conspicuous  loca6on.   •  Remember  your  non-­‐English  speaking   employees.  
  34. 34. Conclusion   •  Learning  and  discovery  tool,  not  a  test.   •  There  will  always  be  room  for  improvement   in  every  organiza6on.   •  Contact   G&A   Partners   if   you’d   like   more   informa6on  on  an  HR  audit.  
  35. 35. Contact  info   Nancy  Edwards,  SPHR   G&A  Partners     713-­‐784-­‐1181   info@gnapartners.com       *  Today’s  recording  and  slides  will  be  posted  on  the   G&A  website  by  Friday.  
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