Human Resources, or HR for short, is one of the most important aspects of your business. No matter what your business does, HR is going to play a central role in many areas.
From recruitment, training, and compliance, to payroll, culture, and strategy, the requirements for HR are everywhere and constantly changing to meet the requirements of your business.
In this post, we will describe exactly what HR is and why you should have HR near the very top of your priorities.
What is HR and why is it important?
An HR team makes sure your business is compliant with all legal requirements and guidelines related to employing people. These requirements related to, but are not limited to:
- Employment Contracts
- Health and Safety
Together, these different areas make HR responsible for designing and helping implement the processes and procedures that make your business run. By taking care of the people correctly, your business can thrive.
What does HR do?
HR does a lot. The different tasks and responsibilities for HR usually span your entire business. The following sections will look at how HR is involved in some of the most common areas of your business.
HR will be heavily involved when it comes to recruiting new employees, with duties often including:
- Writing and promoting he job advert
- Vetting applications
- Performing or scheduling interviews with candiates
- Managing the onboarding process
It is important that you have HR involved with writing the job advert for new team members as this will ensure that any legal requirements are covered.
Your HR team will need to vet any candidates to ensure there are no legal reasons that they can’t be employed. Right to work, verifying required qualifications, and other legal requirements of the new job role must be checked before a candidate can become an employee.
The final stage of the recruitment process, onboarding, is where HR will make sure that the new team member has everything they need to get started in the new position. This will include their employment contract, access to the company handbook, relevant contact details, and more.
Health and Safety
When it comes to your business, Health and Safety is a very broad topic. Your business must:
- Provide a safe place to work
- Provide a safe system of work
- Recruit compenant and safety conscious people
- Provide adequate equipment
Failing to do these things can expose your business to problems, including employees’ claiming constructive unfair dismissal, personal injury claims, and even criminal prosecution.
Your HR team can make sure that all legal and ethical requirements are met with regard to health and safety. Their responsibilities in this matter will include:
- Conducting risk assessments
- Looking after employees’ wellbeing and welfare
- Providing suitable equipment for a safe working environment
- Working to prevent work place injury or accident to minimise absenteeism
- Ensuring suitable insurance cover is in place
Payroll and Pensions
HR will make sure that the required procedures are followed when paying your employees. The most common process for paying employees in the UK is PAYE – Pay As You Earn. PAYE is a system that the government (HRMC) uses to manage the collection of taxes and National Insurance contributions from the earnings of employees.
Besides keeping your business up to date with the requirements of HRMC, they will handle the actual paying of wages to your employees, creating payslips, handling deductions for absences, etc, and communicating with your employees regarding payment.
The governments’ automatic pension enrolment scheme has made it a requirement for employers to automatically enrol eligible staff into a pension scheme. There are certain legal requirements on what an employer can and can’t do with a pension scheme, and HR will be responsible for meeting these requirements for your business.
Performance management of employees comes in many shapes and sizes. Regardless of the approach taken, the goal is to monitor the output and behaviour of your employees against a set of pre-determined expectations.
HR will be involved in developing the pre-determined expectations for employees. This will usually be a collaborative process between HR, leaders, managers, and even employees. Some expectations will be general across the entire business, whilst some roles will have specific requirements. HR will make sure that each employee is aware of what is expected of them. HR will also communicate any changes to these expectations as things evolve.
Your HR will also be involved with making sure a suitable process is in place to monitor performance, and that everybody is aware of how this process works.
Attendance and Time Tracking
Anything related to staff rotas, paid time off, absences, overtime, and lateness will involve HR.
HR will ensure that your business meets any legal requirements regarding employment law related to time management. This includes meeting minimum holiday entitlements and requirements and ensuring suitable breaks are taken.
Who are HR?
Depending on the size of your business, your HR department may be a single person, a small team, or an entire department. Below we will highlight some of the more common job titles associated with HR, and what their responsibilities will be.
It is worth noting that in practice, especially if your business is smaller, that members of the HR department will be responsible for a collection of areas rather than a single area.
The HR director has overall responsibility for the entire HR department and HR in general. They will ensure that the department is working towards achieving the goals of the overall company strategy and will work directly with the company leadership team, such as the directors.
A HR manager will directly manage the HR team. They will be on hand to offer support to the other members of the team, and will often work directly with other employees too.
A recruitment manager will be responsible for all areas related to recruiting new members to the team. They will design the recruitment process which will often include employee branding in line with the culture of the business.
The payroll manager will handle all areas related to payroll. The payroll manager will be involved with selecting and using the actual systems used. They will make sure legal requirements are met regarding payment and benefits including the company pension scheme.
The training manager will help other departments construct their training programmes to meet your business development goals. Your training manager will also be involved with general performance management processes.
An HR assistant will be generally responsible for the admin requirements of HR. They will work with other members of the HR team, and with your employees directly to maintain accurate records for your employees and the business in general as it related to HR.
Can you Outsource HR?
You can outsource the role of HR. If your business is just getting started, it is quite common to outsource your HR requirements. There are no legal requirements to have a dedicated HR person or employee. However, there are legal requirements for ensuring your business is compliant with all areas of employment law. As long as you meet these legal requirements, you can decide if you should employ an in-house HR person, or if you can outsource it.
A very common approach is to start with outsourced HR, and as your business grows, to bring some full-time dedicated staff on board to handle HR.
The cost of employing HR staff vs outsourcing will obviously play a big role in which approach you take.
What is HR Software?
HR software is a system for managing and optimising regular human resource tasks. Depending on the size of your business, you will have different requirements from HR software, but almost every business will benefit from a Core HR system with the following benefits:
- Centralised store of employee information
- Self-Service holiday and sickness tracking
- Distribution of company handbook and policies
- Recruitment and onboarding of new employees
- Organisational mapping
- Performance reviews and target setting
- Track Training and Professional Development
- Benefits and compensation recording
- Reporting and analysis of your employees
What is HR? A Summary
There are many areas of HR. All of them are centrally important in running a successful business that is compliant with all areas of employment law. This includes recruitment, health and safety, payroll, performance management, and more.
HR can be handled internally or outsourced, depending on the size and requirements of your business. HR has many different roles. As your business grows, so too will the size of your HR team.
HR software can be used to organise and optimise regular HR tasks.