Audit, Assess, Exam or Review – Whatever You Call It, Just Get it Done!

Employment in today’s fast-paced business environment can be challenging for business owners.  Staying compliant with the ever-changing regulatory landscape while delivering a product/service, attracting and retaining great employees, and adding to the bottom line has never been more difficult.

Getting a clear picture of where you are at and uncovering areas that need improvement is essential to maintain a competitive advantage. It’s not about being right or wrong – it’s about being aware. An assessment allows you to identify areas of opportunity and confirm that your Human Resource (HR) functions are in compliance with relevant laws and polices.

What is an HR Assessment or HR Audit?

An HR assessment/audit is an objective observation of your company’s HR policies, procedures, practices and strategies to safeguard the company, identify areas that need improvement and set up best practices to help your business thrive. Included as part of the review is a comprehensive compliance analysis that ensures the company’s policies, procedures, practices and strategies are compliant with federal, state and local employment laws as well as certain industry-specific regulations.

Are there Benefits?

There are numerous benefits that can be seen at a strategic, operational and administrative level. Besides reducing legal exposure, an effective assessment may also illuminate cost-saving activities and reveal communication inhibitors among departments or duplication of work. Unearthing this information may yield a more positive work environment or save resources. Additionally, it will aid in identifying strengths and lend focus on continuous refinement. Bottom-line, an HR assessment can help you not only achieve operational efficiency, but also take your HR function to the next level with sound practices and policies.

Is My Business in Need of an HR Assessment?

Given the resources required for a full-scale assessment, most companies will not want to go through this process more than once a year. Scheduling annual checkups can help maintain the discipline of a regular review and is preferable to only occasional or panic audits. Another strategy is to conduct an audit following any significant event (e.g., significant regulation or process changes, management changes, etc.). Below are a few questions to determine if it’s time for an HR assessment:

  • When did I last update my employment forms, documentation and policies?
  • Does my company maintain current and complete employee records?
  • Do I have current I-9 documents on file?
  • Did I know penalties can be assessed for hiring unauthorized workers or mistakes in paperwork if the person is eligible to work in the country?
  • Did all my new employees complete the I-9 form within 3 business days of hire?
  • Do organizational charts accurately reflect my company today?
  • Do I regularly review and update job descriptions?
  • Is my company’s employee handbook relevant or was it written before email or social media existed?
  • Do I collect and retain signatures to acknowledge that my employees have received the handbook?
  • How does my company stay abreast of the heavily regulated employee environment?
  • Are my company’s recruiting, hiring and termination practices fair and compliant?
  • Do my company’s safety protocols meet current industry standards?
  • Do I maintain a positive work environment where all employees feel valued and treated fairly?
  • Am I attracting and retaining the right people?

Keep in mind, within the constraints of time, budget and resources, an HR assessment can be as comprehensive or as streamlined as your company needs it to be.

Do I Really Need to Go Through this Process?

The answer is simple: Yes! If you don’t want to do it for all the benefits previously highlighted, do it to prevent large penalties. Awareness is key. Penalties for violations are high and on the rise. For example, Immigration and Customs Enforcement (ICE) recently announced the largest payment ever in an immigration or I-9 Form investigation – a whopping $95 million was paid to settle criminal and civil charges by a Pennsylvania tree company who employed undocumented workers. Even in less serious violations, ICE has been hitting employers’ I-9 paperwork violations; which can now be as high as $2,191 per form.

As a business owner, you don’t have the time until it is often too late.


This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

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