Have you ever heard a company declare that “our people are our greatest asset”? It’s a popular refrain in the business world, but some employers commit to the concept more than others. One way to demonstrate your commitment to your workforce is to establish an effective human resources (HR) department.
An HR department does everything from overseeing hiring to managing employee compensation to fielding employee concerns. Here’s an overview of human resources, and the role a human resource department plays in employee relations.
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What is human resources (HR)?
Human resources (HR) is a collective term for the workforce or employees of a company. However, it’s also commonly used to refer to the department or group of workers responsible for managing a company’s workers. In many organizations, human resources management is the domain of a dedicated human resources department, also known as an HR department or a personnel department.
HR professionals play a key role in ensuring an organization’s human capital is effectively recruited, trained, managed, and supported. When properly managed, human resources departments not only promote employee satisfaction but also help further a company’s business objectives.
Human resources responsibilities
- Recruitment and staffing
- Employee onboarding
- Training and development
- Performance management
- Worker compensation and benefits administration
- Employee relations
- Policy enforcement and compliance
- Employee records and data management
- Organizational development
- HR technology implementation
The specific responsibilities of HR can vary significantly between organizations, depending on the size, industry, and structure of the company. The duties of HR departments typically center on fostering a positive work environment, promoting employee wellbeing, enforcing workplace policies, and helping the organization achieve its objectives through effective workforcemanagement. HR responsibilities may include the following:
Recruitment and staffing
HR is responsible for attracting and hiring qualified candidates to fill job vacancies within the organization. This may include creating job descriptions, publishing job postings, running background checks, conducting interviews, and managing the selection process. HR professionals also often make compensation recommendations, creating ranges for positions based on experience and location, and conduct salary negotiations with potential hires.
HR facilitates the orientation and integration of new employees into the organization. This process includes providing information about company policies, benefits, and culture, as well as routine processes such as equipping employees with accounts, company email addresses, equipment, and company cards. Onboarding may also include creating employee records and submitting information to government entities like the IRS and the Bureau of Labor Statistics.
Training and development
HR departments oversee training and development programs to help employees acquire the skills needed to perform their jobs effectively and progress along their career path. In some cases, HR professionals might organize on-sitetraining programs; in other cases, companies offer online training via webinars and training apps. HR may also provide external resources for external training and development, whether that’s access to an educational course or a research conference.
Along with people managers, HR teams play a role in evaluating employee performance. They may create annual or biannual performance cycles where employees and managers can give and receive feedback through a formalized process and discuss performance, raises, and improvement plans. Some HR departments may even provide the feedback themselves, working more closely with employees on their trajectory in the company.
Worker compensation and benefits administration
HR departments manage compensation and benefits programs, which include salary structures, bonuses, health insurance, stipends, and retirement plans. HR managers rarely process payroll—that’s typically left to other departments like accounting—but they may administer the system that determines employee raises.
HR serves as a point of contact for addressing workplace conflicts, grievances, and employee concerns. It provides support to individual employees and resolve disputes among workers. An HR department works to foster a positive work environment and enforce standards for organizational behavior.
Additionally, HR teams often work on improving employee morale and productivity. Activities such as planning offsite events, team-building exercises, office parties, and distributing holiday gifts or merch often fall within the remit of HR teams as well.
Policy enforcement and compliance
Human resource management teams help develop and enforce company policies and procedures that maintain legal and ethical working conditions. They ensure compliance with local, state, and national laws related to equal employment, harassment, discrimination, and workplace safety. HR departments must stay abreast of new laws that impact their employees, and develop policies that adhere to these in a timely manner.
Employee records and data management
HR maintains records of employee information, such as payroll records, personal details, and performance evaluations, to facilitate various HR processes. When legal and appropriate, HR workers may distribute information about workers to other departments, or even to outside vendors, like a 401(k) manager.
HR may be involved in strategic planning and organizational development efforts to align the workforce with the company’s goals and growth strategies. In some cases, HR may play a role in shifting a business’s organizational structure, such as creating new departments or streamlining managerial roles.
HR technology implementation
Many of today’s HR needs can be handled by software applications. As such, HR departments often leverage technology and software to manage HR-related data and automate administrative tasks. HR technology lets HR managers focus on more strategic duties, like organizational development and performance management.
Internal vs. external human resources
Businesses may choose to create a human resources department within their own organization, or they may choose to outsource HR duties to an outside firm. The former is called internal human resources management, while the latter is called external human resources management.
Companies may also create a hybrid system where some tasks, such as recruitment, benefits, payroll, compliance, and training, are outsourced to an external company. Roles that require familiarity with the team, such as measuring performance and recommending promotions, conflict resolution, and strategic planning, stay in-house.
Human resources FAQ
What does a human resources department do?
A human resource department, whether a single person or a large team, is responsible for managing various aspects of an organization’s workforce, including recruitment, employee relations, benefits administration, and compliance with labor laws and company policies. They may also be tasked with developing strategies for employee engagement and succession planning. HR workers benefit from good communication skills and an ability to manage many workers and tasks simultaneously.
What is human resource management?
Human resource management is the strategic and operational oversight of an organization’s workforce to ensure it effectively contributes to the company’s goals and objectives.
Is it better to outsource my human resources department?
You may choose to outsource your human resources department to an outside vendor. These vendors may specialize in tasks like payroll management and training employees, and they may be cheaper than hiring an in-house HR team. As a downside, external HR departments do not get to know your workers on a personal basis, and they may be ill-equipped to handle workplace disputes or identify leaders within your organization.
Should I use human resource software?
Human resource software can help you streamline HR processes, improve data accuracy, enhance employee engagement, and lead more efficient decision-making. As such, many organizations, large and small, choose to use HR software.