9 HR Best Practices You Need to Follow in 2023

In 2023, HR departments have shifted their focus from the future of work to the now of work. Many HR practices established during the COVID-19 pandemic (which forever changed our working lives) have accelerated, forcing companies to rethink HR best practices—and plan for a quickly changing future.

Companies that embrace HR best practices see better morale, improved productivity, and increased employee retention. According to an extensive study by Oxford University, happy employees are 13% more productive than unhappy employees. For employees in sales, boosting happiness can increase closed deals by 37%.

As a strategic leader at your organization, it's up to you to align HR goals with the overall business goals so everyone is on the same page.

BambooHR assists 30,000+ companies implement HR best practices at scale. Our award-winning, intuitive software makes it simple to modernize hiring, onboarding, compensation, and more——regardless of your organization's size, location, or industry. Take a video tour today!

HR Best Practices vs. HR Activities: What's the Difference?

Before diving in, it’s important to clarify the distinction between HR practices and HR activities. Both are needed for an HR department to fully reach its potential and for an organization to optimize its human capital investment.

HR best practices involve the strategic operations of HR. They form the foundation and guidance for managing the company’s employees and should coordinate with the executive business plan. Some examples of HR practices include:

In contrast, HR activities are the daily activities to implement the strategies determined by HR practices. They allow the mission and goals of the HR department to be carried out. HR activities may include:

Essentially, HR practices look at what an organization wants to do and why; HR activities address how.

When HR practices and HR activities are aligned, HR departments can thrive, and your company benefits. Optimum human resources involve an understanding and integrated approach to HR practices and HR activities.

The 9 Most Important HR Best Practices

1. Invest in the Right Technology

Choosing HR technology for your business is like shopping for a new smartphone. You likely put some time and consideration into what you’ll use the phone for, what features you want, and how much you’d like to spend on it. Essentially, you’re going to make sure the phone you purchase aligns with your specific needs. The same principle applies to choosing HR technology. You’ll want to ensure the technology you choose aligns with your specific HR and business needs.

For example, say you’re looking to reduce employee onboarding time by 25% over the next year. You’d like to maximize your training time by creating a “one-stop-shop” for new employees, ensuring easy access to training, company resources, and more. You should then focus your search for HR technology on platforms with a seamless onboarding experience and a centralized document hub.

Once you’ve determined your primary requirements, you’ll want to ensure the platform includes standard HR features, such as:

Finally, you’ll want to ensure your HR technology not only helps your HR department but your employees as well. BambooHR provides everything HR personnel need to complete daily tasks and empowers employees to help themselves via the intuitive dashboard and easy access to helpful resources. BambooHR’s unique focus on assisting HR teams and employees makes our suite of HR tools different (and more effective) than other platforms.

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2. Streamline Recruitment and Hiring

Companies seeking to hire high-performers are turning to innovative processes to streamline hiring.

There are many ways to assess whether someone will be a good fit for the company, both as a high-performer and as a cultural fit. While not every innovative hiring process will be right for your team, you can learn from companies that have created HR best practices around hiring and provided data for the rest of us.

Here are a few examples of best practices to consider:

When posting the perfect job ad, include information about your organization—what technology you use, what kind of products you create, your mission and vision, and more. Including this contextual information can encourage more candidates who believe in your organization’s mission to apply. The best candidates can always learn additional skills; you want employees who will be engaged from day one.

3. Offer Effective Onboarding, Training, and Development

You’ve taken the time to find employees to hire, but your responsibility to them is only just beginning.

It’s an HR best practice to invest in training and development opportunities to improve your current workforce, focus on skill-specific training, and realize the value that young workers place on learning. As industries advance at an ever-increasing pace, you can support and encourage your employees to grow as well, keeping them more engaged in their work and your organization.

4. Handle Layoffs With Compassion

This is probably the toughest place to implement HR best practices because it will always be difficult for those involved―and it’s becoming an increasingly more regular practice. According to Forbes, 136,000 employees were laid off during the first fiscal quarter of 2023. Roughly 50% of employers anticipate a reduced headcount in the next six months.

As organizations prepare for these situations, it’s crucial to follow HR best practices. These include learning from employees terminating their employment and understanding which topics are sensitive for legal reasons. Issues that may warrant termination should always be addressed before they reach a boiling point. However, when it does come to terminating an employee, don’t drag out the decision.

As you implement these HR practices, you may discover that employees who leave soon after being hired did not have a good indication of what the job entailed when they were hired, and you might consider revamping your hiring process.

Always say goodbye on good terms.

Offboarding employees isn't easy, so BambooHR is here to support you every step of the way. What’s more, our instant reports will help you spot trends in departures, so you can stop turnover before it starts.

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5. Build an Inclusive Company Culture

A crucial HR practice is to maintain transparency and be open with employees regarding the successes and failures of the business. Organizations that foster an environment of open feedback and communication help employees feel trusted, respected, and valued.

To be a high-impact HR department, you should:

As an HR department, you should avoid focusing on efficiency and cutting costs above all else, as this could actually be less effective in the long run. Instead, promote practices that create transparent environments and encourage information sharing.

6. Offer Compelling Benefits

According to a BambooHR survey, 68% of job seekers want information about the specific benefits companies offer, yet 36% of organizations report they don’t offer information about their benefit plan upfront. Being transparent about your benefit plan and how it accomplishes company goals helps retain great employees and attract high-quality talent.

While Google’s approach certainly isn’t feasible for all companies, it is important to identify where you’re losing money and why you might struggle with employee retention. If you want to hire and keep the best talent, you have to treat them like they’re the best talent and show you value your employees.

7. Motivate Employees With the Right Incentives

According to Gallup, 18% of employees were actively disengaged at work during 2022. To combat disengagement rates, employers need to find more effective ways to motivate employees. That starts by offering more incentives. However, for incentives to be effective, you must first understand the type of incentives employees want. You’ll then need to implement new practices properly, or you risk demotivating your employees instead of motivating them. Here are some HR best practices for providing effective employee incentives:

Providing the right incentives shows employees that you care about them and the value they add to your company.

8. Offer Competitive Compensation

If you want great employees, you need to have great compensation plans. Above-average employees deserve above-average compensation, and you want to show your employees you value them and the work they do.

Some HR best practices for compensation include:

Whatever your company's compensation strategy, it should be based on the productivity and contributions of the employees, and the managers in your organization should be prepared to communicate about it.

9. Resolve—and Avoid—HR Compliance Violations

The best way to handle compliance issues is to avoid having them in the first place. Here are some human resource practices to prevent compliance issues:

Hiring, employee classification, and wage requirements all require constant attention to stay in compliance. Utilizing your point person and HR software can help you stay one step ahead of any upcoming changes to HR.

Next Steps: Choose a Partner that Empowers You to Meet Best Practices

The first step to implementing HR best practices is to use the right technological platform. As mentioned earlier, you want to ensure the platform aligns with your business needs and empowers employees to do their best. Avoid going with a platform that makes it difficult for employees to find what they need or doesn’t align to your specific company goals. This could result in lower employee engagement, higher turnover, and decreased productivity.

Bamboo HR has helped 30,000+ companies not only follow best practices but empower employees to do their best work. Our comprehensive platform includes everything you need to streamline HR practices, boost employee engagement, reduce turnover, and provide a high-quality employee experience.

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