Importance of HR Audit in Preventing Department of Labor Investigations

Published: 27th October 2009
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All it takes is one disgruntled employee to complain that your company is using unfair labor practices and the next thing you know, the company is under a Department of Labor investigation.



Under the Department of Labor, the Employment Standards Administration (ESA) enforces and administers laws and regulations about:



• Legally mandated wages and working conditions that include:



o Minimum wage

o Overtime

o Medical leaves

o Child labor



• Equal employment opportunity in businesses with federal contracts and subcontracts



• Worker's compensation



• Internal union democracy and financial integrity



• Union elections



• Other laws covering employment standards and practices



To avoid the hassle of labor investigations, employment law attorneys and Human Resources practitioners recommend that you perform human resource auditing.



An HR audit is a study that proves to you, as the business owner, that everything is running as it should in the payroll and HR department.



An HR audit should be able to give you the following benefits:



• The effectiveness of your current human resources policies.

• Make sure that your business is in compliance with laws that are related to wages and hours.

• Gives you a chance to solve any problems discovered.

• Solve any compliance issues before a complaint is made.

• Evaluate actual employee performance compared to the actual goals of the company.

• Create plans in helping underachieving employees in overcoming their weaknesses



To conduct an HR audit, you can either do it yourself or hire outside help like an independent HR Agency.



• The HR audit usually starts by gathering all necessary information including costs of the HR department, law compliance of the company, and effectiveness of all employees.

• All these information will be studied to determine the areas that need improvement and practices where the law is not followed.

• A written report will then be made about the measures that the company will be taking to improve its effectiveness and law compliance.

• The report generally contains the company's action plan and timeline where you can start working towards the new goal.



The steps to be taken towards full compliance with the law should be prioritized before any complaint is made by any unhappy employee.



Efficiency issues can be addressed later on, after all compliance issues are solved.



The HR Audit should be comprehensive or it will not be effective.



An incomplete audit leaves a lot of problems unsolved and defeats the purpose of preventing any more labor investigation.



It is recommended that outside help is taken to avoid any bias in the study.



Some employment law attorneys would also recommend that HR audits be done regularly.



The company should be able to cope with the many changes in the business world; that includes changes in wage and overtime laws.



To know more about employment law standards and compliance, you should consult with an expert employment law attorney for assistance.



To help you deal with labor investigation issues involving discrimination, consult with our expert employment attorneys. Visit our website and call us toll free for legal assistance.

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