Human Resources (HR)

What Is HR?

Human resources (HR) is the department within an organization that handles all employee-related matters, from the application stage to the time an employee leaves the company. This includes areas like recruitment, hiring, and onboarding, as well as performance management, payroll, and benefits administration. HR also encompasses employee relations and policies and procedures.

In managing all of these areas of the business, HR professionals must ensure compliance with all current wage and labor laws. HR professionals also provide short-term guidance and long-term strategy for managers and company leadership in all of these functions.

Typical Responsibilities for an HR Department

If you’re wondering what exactly HR is responsible for, you should begin by looking into which employee-related tasks HR professionals are equipped to handle. Here’s a brief overview of the typical responsibilities the HR department manages and coordinates.

Recruitment and Onboarding

Finding and attracting top talent to fill open positions, including writing job descriptions, evaluating applications, interviewing candidates, and selecting the best person for the job, are all HR responsibilities.

Once a candidate is selected, the HR department also oversees onboarding to ensure the new hire gets acclimated to organizational culture, understands their job responsibilities, and can access all the tools and technology they need for the job.

Payroll and Benefits

HR professionals evaluate budgets, laws, and industry trends to decide on a compensation strategy and determine what benefits should be offered. The department then becomes responsible for processing payroll, calculating and paying employment taxes, and administering benefits so that employees can properly access them.

Performance Management

HR professionals develop systems to measure employee performance. They also create and oversee training programs that help employees gain the skills needed to improve their performance.

In some cases, those in this role help employees figure out their career paths and outline requirements for promotions and advancement.

Employee Support

Employee support requires a broad range of functions, including developing policies and procedures to help employees thrive, answering questions, resolving disputes, and administering discipline. The HR department may also create and launch diversity, equity, and inclusion initiatives and find ways to keep employees happy and engaged.

In today's world, this role often involves supporting remote employees and ensuring they remain connected to company culture. The human resources department has to coordinate IT support and understand and comply with labor laws in different jurisdictions, including those surrounding employee classification and wages.

Administrative Management

A large part of human resources is managing the department's day-to-day functions. This includes a variety of tasks, from processing leave requests to ensuring proper storage of employee records.

Administrative management also involves distributing policies, obtaining signatures as recognition that employees have seen them, and disseminating notices and announcements.

Compliance

Though most departments have to adhere to laws and regulations on some level, HR departments have one of the most daunting jobs in this regard. This is because HR professionals have to comply with more than a dozen laws related to employee classification, wages, and workplace safety, as well as disability accommodation, benefits, wage deductions, and leave policies.

They must also keep up with constant changes and amendments to these laws. Doing so reduces risk and helps keep the organization from having to face costly audits, fines, penalties, and lawsuits.

Roles Within an HR Department

Multiple people must work together to fulfill the employee-related needs of the organization. To accomplish this goal, HR professionals often take on a variety of different roles within the department:

• HR Director: Oversees and coordinates the entire department, ensuring legal compliance and collaborating with senior leaders to align HR with strategic goals
• HR Generalist or HR Coordinator: Acts as a human resources director for small businesses, overseeing and coordinating all HR management tasks
• HR Assistant: Completes office-related organization tasks for HR director and managers, including making phone calls and filing and processing paperwork
• Benefits Administrator: Handles the open enrollment process, explains benefit options to employees, processes paperwork, and answers related questions
• Training and Development Manager: Identifies skill gaps, develops training programs to fill them, and helps employees gain skills to reach professional goals
• Recruiter: Sources, selects, and onboards qualified applicants to fill open positions based on strategic needs and goals
• HRIS Specialist: Selects and manages HR technology by coordinating the needs of the department with the expertise of IT specialists
• Employee Relations Specialist: Addresses employee concerns, administers disciplinary procedures, and oversees employee engagement programs

Typically, smaller companies will have a few HR team members who take on multiple roles. Larger companies can often afford to invest in specialists or even assign entire teams to each function. In states that allow unions, there may be a separate labor relations specialist to help with salary or contract negotiations and grievance resolution.

What Skills Are Vital in HR?

Managing human resources in both a day-to-day capacity and with a long-term strategic lens requires a special set of technical and soft skills:

• Communication: Conveying messages to others via oral or written mediums like email, letters, notices, presentations, and conversations
• Interpersonal skills: Interacting and collaborating with others in order to achieve a common goal
• Problem-solving: Analyzing an issue from different angles, selecting the best solution, and figuring out how to carry out that solution
• Office skills: Staying organized while learning to multitask, manage data, and prioritize responsibilities
• Decision-making: Making a rational and informed choice based on a thorough analysis of the situation
• Financial management: Managing the human resources budget according to the priorities of the department and the organization
• Presentation: Breaking down complex concepts and conveying information in a way that all stakeholders will understand
• Tech skills: Using computer software and HR-related programs, such as word processors, spreadsheets, and time-tracking apps

While many of these skills can be taught on the job, some rely on personality traits, and others should be developed through formal training and certification programs.

Can HR Be Outsourced?

HR functions can definitely be outsourced. In fact, studies show that 57% of business executives currently use external service providers for human resources.

Outsourcing HR has many benefits for businesses, including reducing the administrative burden on the HR team, lessening legal and compliance risks, and gaining access to experts in the field who can help with sound decision making.

There are multiple HR tasks that can be outsourced:

• Recruiting
• Payroll
• Training and development
• Benefits administration
• Inspections and audits

Businesses have several options when it comes to outsourcing HR. One of the most popular involves using a professional employer organization (PEO). When you sign a contract with a PEO, they become a co-employer, which means that they’re an employer of record with the IRS. This allows them to take on legal responsibility for the tasks outlined in your contract, such as payroll and benefits administration.

Because PEOs are large businesses, they often have access to better and more cost-effective benefits options than what some smaller or medium-sized companies can access on their own. If your business would prefer not to enter into a co-employment relationship, you can also outsource to a human resource outsourcing (HRO) company that can provide these same services on an a-la-carte basis.

HR professionals who want to get the benefits of outsourcing without actually having to entrust their HR functions to a third party often turn to technical solutions like human resource information system (HRIS) software. These platforms automate HR tasks like payroll, timekeeping, and benefits administration, helping HR departments work more efficiently.

Using automation, HR professionals can still lighten their administrative load and reduce compliance risk with automatic calculations, easy tax filing, and e-signatures for policy documents. This, in turn, provides them with more time to focus on strategic tasks instead of constantly worrying about managing day-to-day issues.