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What Is Human Resources (HR)? Definition and Guide

what is human resources

Human resources (HR) is the department within a business that is responsible for all things worker-related. That includes recruiting, vetting, selecting, hiring, onboarding, training, promoting, paying, and firing employees and independent contractors. HR is also the department that stays on top of new legislation guiding how workers need to be treated during the hiring, working, and firing process.

HR is considered by many business strategists to be the most important of all company resources. That’s because employees can gain new skills, thereby increasing the size of a company’s competitive advantage over time. Other resources simply don’t have that capacity.

The trend toward outsourcing

As with many aspects of business, HR is one function that some businesses now outsource. By handing over responsibility to an outside agency to find, hire, manage, and pay qualified workers, the company can stay focused on developing its core competencies. 

Some different types of organizations that will handle your HR responsibilities include:

  • Professional employer organization (PEO) – PEOs assume complete responsibility for all aspects of your HR function. That includes finding and hiring workers and setting their pay rate. Employees work for both the PEO and your company.
  • Human resource outsourcer (HRO) – Companies uncomfortable with handing over all responsibility and control of their employee base may be happier with an HRO, which handles all HR activities but does not actually employ workers.
  • E-services – Using an online HR platform enables small businesses to maintain control of their HR activities while leveraging information technology to do it more efficiently.

HR responsibilities

The list of tasks the HR department oversees is quite lengthy. Besides hiring and firing, HR professionals also take care of:

  • Recruiting
  • Background checks
  • Drug testing
  • Relocation
  • Training and professional development
  • Compensation plan development
  • Employee assistance plan
  • Outplacement
  • Payroll management
  • Benefits administration
  • Legal
  • Employee relations

A well-functioning HR department ensures that a business has all of the right employees it needs, at the right time, at an affordable cost, and it helps support the continued development of those workers, providing the company with an appreciating human asset.

What Is Human Resources? FAQ

What do you mean by human resources?

Human resources (HR) is the division of a company responsible for managing personnel and hiring new staff. HR departments are responsible for overseeing employee benefit programs, developing company policies, managing payroll and employee records, recruiting and interviewing new hires, and providing guidance and support to managers and staff.

What are the 4 types of HR?

Recruitment and Selection
Training and Development
Compensation and Benefits
Employee Relations and Engagement

What are 10 examples of human resources?

Recruiting and hiring
Performance management and improvement systems
Training and development
Compensation and benefits administration
Employee relations and communication
Safety and health
Employee recognition and rewards
Employment law compliance
HR analytics and metrics
Organizational development and change management

What is human resources and its importance?

Human Resources (HR) is the department within a business or organization responsible for managing its employees. HR is responsible for hiring, firing, and managing employee benefits, payroll, and other staffing needs. HR is also responsible for ensuring that employees comply with company policies and regulations, and that they receive the proper training and development needed to perform their job duties. The importance of HR is that it ensures the company has the right people in the right positions, and it helps to create an atmosphere of fairness and respect among all employees. HR also helps to ensure that employees are given the opportunity to grow and develop within their roles.
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