A Beginner's Guide to Human Resources Management

There are many elements that make up a company. Day-to-day operations, managing finances, marketing and dealing with the workforce are an essential part of a company's work. In small and medium-sized companies, this is often the responsibility of a single person or a small handful of employees. In larger companies, each business area has its own department.

Regardless of the size of your company, human resources (HR) is one of the most important areas. The tasks and responsibilities that fall under the umbrella of HR are vital to any business. However, many professionals don't know exactly what HR does.

Some business areas are self-explanatory. Warehouse management concerns the setup and operation of your warehouse. This is pretty easy to understand. If you ask someone to define HR, they'll probably say something about hiring and firing. But that's just a rough approximation of the surface.

In this guide, you'll learn what HR is, what it does, and why you might want to pay more attention to it.

What is Human Resources?

The human resources department (HR) is an area that deals with all issues relating to a company's workforce. The human resources manager or human resources department of a company is responsible for the employees. He must take care of their needs, their interactions with the company and all other business practices related to the workforce.

You might be thinking that that's pretty much it. You're not far off the mark. The responsibilities of an HR manager impact most aspects of an employee's job on an almost daily basis. It is the breadth and complexity of HR that explains why many people don't understand what it is.

But it is precisely this versatility that makes the human resources department so important for every company. In order to get a handle on human resources work in your company, you need to understand this area better. The best way to get to know HR is to look at the most important tasks.

What does the HR department do?

The term “Human Resources” reveals more about the field than initially appears. The term refers to the management of a company's workforce. These workers are often the company's most important resource. The human resources department also has the task of supporting and caring for employees. It is an important resource for your daily work. The area has many names.

Below are ten of the most common tasks a human resources manager or human resources department performs. Taken together, they help ensure that HR can both manage and support a company's employees.

Management of hiring and terminations

Most people are familiar with this area of human resources. Hiring and firing team members is an essential part of any company's existence. When an employee is fired, the HR department must take care of termination of contracts and other formalities. They may also need to oversee the return of equipment or revoke access rights to premises.

When it comes to recruiting, HR is responsible for finding the right candidates and getting them on board. This includes defining the positions to be filled and establishing criteria against which applicants will be assessed. This also includes the HR department conducting the interviews and coordinating with other departments to make a decision.

At least some elements of onboarding are often handled by the HR department. Contracts and other paperwork related to newly hired employees must be completed and filed. These new employees also need to be integrated into their teams.

Payroll

All payroll and all financial data related to the workforce are also managed by the HR department. What exactly this means varies from company to company. However, even in smaller, less complicated companies, this can include all of the following:

• Counting working hours
• Payment of salaries
• Calculation of taxes
• Reimbursement of expenses
• Managing and changing payment plans
• Processing salary increases and bonuses

In a large company, this area of HR alone can be a full-time job for a team of employees.

Setting and managing employee benefits

It's not just salaries, expenses and bonuses that fall under the responsibility of the human resources department. The department is also responsible for employee social benefits. This means that it decides on the services offered and takes care of their administration.

Providing the right benefits to employees is crucial. They can make the difference between a candidate choosing your company or going elsewhere. Promising applicants often accept a lower-paying job if it offers better benefits. Health or dental insurance could have a much larger impact on your finances.

When hiring, a hiring manager might review the performance of other companies in your niche. This type of analysis helps you stay one step ahead of your competitors. If you have services such as: For example, if you offer health insurance, there are many administrative and financial implications. HR managers also have to convey this. You also have to pay out any bonuses, e.g. for employees who have particularly distinguished themselves in sales or customer service.

Create staffing plans and company policies

If your business continues to grow, you need a workforce plan. This is a comprehensive strategy that allows you to attract new talent when needed. It is the responsibility of the HR department to create and execute such a plan. It must also do this in coordination with other areas of the company.

A new inventory management system introduced by logistics could impact your staffing plan. HR must work with this department to optimize the hiring strategy. In the same way, the HR department also needs to develop and constantly update company policies. These policies must remain relevant to the company and its employees.

Promote positive relationships

HR is not just about paperwork and practicalities. The department is also responsible for relationships within your company. This is about both the relationships between employees and the relationships between the employees and the company.

Such relationship management can be crucial to the success of a company. Positive interactions and proper treatment of employees promote a satisfied workforce. Satisfied employees are often more productive than dissatisfied ones. Additionally, improper treatment of employees by a company can legitimately result in legal or financial penalties.

Conduct disciplinary investigations and actions

Things don't always go smoothly in every company. There are problems in every workforce. When such issues arise, they must be dealt with professionally and appropriately. Complaints and reports of difficulties are forwarded to Human Resources.

Human resources staff must investigate all allegations of misconduct. This could be a complaint from an employee about a colleague. But it could also be a report about poor treatment by the company. It could be a request from the company to discipline an employee.

Disciplinary procedures are an important task of the human resources department. It is crucial to the cohesion of a company that complaints are handled in an impartial manner. Employees must feel safe and comfortable at work. At the same time, they must also be held accountable if they do not comply with company standards.

Monitor employee satisfaction and offer support

HR not only takes care of important issues but also overall job satisfaction. The employees of the most successful companies are happy and excited to come to work in the morning. It is another responsibility of the HR department to achieve this level of satisfaction in your company.

There are a plethora of ways HR managers can increase employee satisfaction. A good example of this is providing clear pathways for professional development. If they know they can grow in their role, many employees will be much happier. Help with training or professional development is something else that is very popular among employees. They give people a greater sense of accomplishment and personal growth at work.

Design and manage training

Many workers need training so that they can perform their tasks properly. New employees or employees in new roles must be briefed on their duties and proper procedures. This training is another task that falls on the broad shoulders of HR professionals. To train new employees, the human resources department may need to design comprehensive courses. Existing employees may also need to be brought in to assist with the training.

Promotion from within the ranks is an excellent strategy for many companies. If you promote an employee to a management position, they may need additional training. The HR department can organize places for external training or retreats. The department may also arrange replacement for employees who are unable to attend work due to attending training.

Promoting health and well-being

Your HR department is also responsible for the health and well-being of your employees. This is an often unappreciated but important aspect of HR work. Their tasks in this area include ensuring that workplaces meet safety standards. This also includes supporting employees who have health problems.

The human resources department is the point of contact for employees who need help with serious or chronic illnesses. This applies to both physical and psychological complaints. The HR department helps the employees in dealing with their grievances. With the help of HR, employees can get the treatment they need and get the right support in the workplace.

Keep records

You may have noticed that we've talked a lot about paperwork so far. There is a wealth of documents and records related to human resources work. A final task of the department in your company is to store and maintain all the resulting documents.

Documents such as applications, pay stubs and benefit plans should be retained by the human resources department. These documents serve to support your daily work. You may also need them to demonstrate that your company is compliant with industry regulations. Speaking of which, depending on your location, there are often some employment records that you are legally required to keep.

When should you focus more on HR?

If you didn't know it before, you should now realize how important HR functions are to your company. No matter what niche you are in and how advanced your business is, you need to give HR the time and attention it needs.

In the smallest companies, the owners or managers can take on these tasks themselves. However, many companies require their own human resources specialist or department. Below are four scenarios where you need to focus more on HR.

Scaling your business

If you've started a business from scratch, you may not have specifically thought about HR in the first few days. While you may have taken on related tasks, you probably saw them as part of company operations. As you scale your business and try to achieve sustainable growth, HR needs to take center stage.

A dedicated human resources professional can help you get your hiring right. He is able to identify your company's skills gaps and knows how best to close them. Additionally, HR can track the performance of your growing team. This is something you won't be able to do as well as your business expands.

Regulation and legislation are changing rapidly

Laws and regulations are evolving rapidly. This particularly applies to labor law and workplace legislation. Regardless of your industry, you have legal obligations towards your employees. Failure to meet these expectations can result in significant penalties.

When regulatory changes come into effect, you don't want your business to fall behind. With all the other tasks you have to manage, compliance with these regulations can sometimes fall by the wayside. A dedicated HR manager can take on this task. Part of his job is to monitor changes in labor law and ensure your company stays compliant.

Low work ethic

If your workforce is unhappy or unsettled, it could be because you haven't paid enough attention to HR. After all, HR is not just about hiring and firing, but also about supporting your employees.

If you don't have HR under control, there will often be more disruptions in day-to-day operations. Dissatisfied employees are not as productive and there can be more arguments. The end result of a disharmonious workforce is high employee turnover. This is something no SME would want.

The current HR structures are overloaded

Even if you don't have your own HR manager or department, your company still has HR tasks. Chances are good that you will either do these yourself or rely on another team member. This means that HR tasks take up the time available for other tasks.

As a company develops, the tasks and responsibilities in human resources multiply. At some point, the person doing the tasks will spend the most time doing it. At this point, you should hire a dedicated HR professional. He will increase productivity in all areas and ensure that all personnel matters are handled correctly.

HR - the most important part of the business that you haven't fully understood yet

Human resources is the most well-known and least understood aspect of business. Everyone has heard of HR, but few really know what it entails. After reading our guide, you can counteract this trend.

Giving HR the attention it needs can mean the difference between success and failure. A strong HR department means you can create the best team and keep them happy and engaged. It also ensures that your business does not fall foul of regulations or laws that could be crippling.

IceHrm streamlines HR tasks, fostering team success and compliance. Elevate your HR practices with IceHrm today!