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The scope of the Human Resources department is more than just processing payroll and setting employee health benefits. HR plays an essential role in developing a company’s strategy by enhancing employees’ perception throughout the workforce and providing a well-rounded experience for employees. 
From improving company morale and developing methods to ensure high-performance standards to resolving conflicts among employees and ensuring a business stays within its budget, there are many reasons HR is so important for business success. 

8 Ways You Will Use HR In Your Business 

There are many reasons for needing human resources within a business. Whether you’re a small enterprise or a large corporation, you will look to HR to help your employees and you, as the employer, improve ways of working within the business. We’ve outlined eight core ways that HR in business matters; these are things we believe are the foundations of a healthy business that look to improve processes and increase productivity within the organisation. 

1. Recruitment and Onboarding 

One of the most well-known aspects of HR is to oversee the hiring and onboarding of new employees. But it’s a lot more complex than just looking at CVs; HR professionals are involved at every level of the process. They are tasked with determining the most effective methods for recruiting applicants and attracting talent to the organisation. 
 
Their primary goal is to work closely with hiring managers to effect good hiring decisions, according to the organisation’s needs. But you’ll find that HR professionals are also there to help guide managers, who aren’t familiar with the hiring processes, to extend offers to suitable candidates while also playing a part in mediating contract negotiations. 
 
Once a candidate has accepted an offer, the HR team takes steps to welcome them into the organisation and work culture. Onboarding can be broken down into 3 categories: 
 
Organisational onboarding – employees learn the organisation’s history and culture, as well as procedures 
Social onboarding – employees acclimatise to their new team and its social dynamics 
Technical onboarding – employees learn how to perform the tasks associated with their new job 
 
Research shows that onboarding can have a significant impact on a candidate’s first impressions, which can dramatically impact engagement, work performance, and longevity. 
 
A poor onboarding experience is often cited as one of the key reasons why more than 25% of new hires quit their jobs within three months. Hiring is a costly and lengthy process, and replacements can be hard to find. As a result, an active, engaging, and streamlined hiring and onboarding process led by a dedicated HR team is essential in building a truly effective workforce. 

2. Employee Benefits and Compensation 

Compensation and benefits refer to the benefits a firm provides to its employees as part of their employment. 
 
HR plays a significant role in determining and managing benefits and perks and helping employees to access them. Some benefits can be accessed immediately, while some are awarded under certain circumstances such as promotion, length of service, or on completion of training or personal development programmes. 
Benefits and perks are also an effective way to attract new talent to an organisation. Salary and incentive packages are one of the main reasons why people apply for specific jobs. They can improve a candidate’s quality of life, such as helping them save money, add to their disposable income, improve workplace wellbeing, and maintain a better work-life balance. 
 
As a result, benefits can often make or break a candidate’s decision to accept an offer. Examples of company benefits can include flexi-time, health care plans, work from home options, gym memberships, child care subsidies, free or subsided travel, and more. 

3. Employee and Labour Relations 

Businesses require effective communication to operate well, and HR plays an integral role in facilitating and maintaining good communication at all levels of an organisation – this can come in a variety of forms. 
 
It can mean guidelines for day-to-day communication across the organisation; the way communication occurs in a business is defined by HR, and can refer to things like internal comms, formal processes, and more. Good communication mitigates misunderstandings, increases employee engagement, forms the basis for better client relationships, encourages innovation and creativity, and helps build a positive culture. 
 
The way organisational communication is conducted can also have a huge impact on business success. Most HR professionals and leaders agree that linking corporate communication to business strategy is essential to positive and consistent business operations. This includes all forms of communication from the top down. 
 
Employee and Labour Relations also plays a huge role in building effective relationships and mediating potential issues or conflicts. Workplaces are incredibly dynamic, and conflicts can happen in any organisation. Sometimes they can be minor, or they can be quite significant. HR advocates are often tasked with creating a middle ground where conflicts can be addressed and resolved. 

4. Legal and Employment Compliance 

HR departments are also tasked with ensuring the organisation is operating in line with employment and compliance laws where they are based. To do this effectively, HR departments must take a proactive approach to ensure that the organisation meets its legal obligations. 
 
This refers to all aspects of employment, including assurance that staff receive their contractual and statutory workplace entitlements. It also involves ensuring that the organisation is following fair recruitment policies, preventing and tackling workplace discrimination, and ensuring staff are paid what they are owed. 
 
Additionally, HR compliance requires staying on top of any employment law changes. HR professionals must have a full understanding of employment law and the regulatory requirements of a business associated with staff, and deciding how an organisation will meet new compliance responsibilities is always an ongoing task. 
It’s not just the organisation itself; staff training legal requirements are one of the most important forms of training that an organisation can conduct. It’s essential for staff to understand the many different regulations and legislations that govern their job and the business that they work for. 
 
Finally, it also includes ensuring that employees receive training as outlined by legally required compliance. It’s essential for staff to understand the many different regulations and legislations that govern their job and the business that they work for. This can involve issues such as health and safety, GDPR, and equality and diversity, to name just a few. 

5. Payroll Management 

By its very nature, payroll spans across both HR and finance. However, in its capacity as a mostly employee-facing function, any significant changes to payroll are often directed by HR. 
 
On a day-to-day basis, HR professionals are responsible for a significant number of key actions involving payroll decisions, which include everything from recruitment and performance management to authorising annual leave and overtime. The majority of tasks processed within payroll – changes to pay, salary, bonuses, employee working hours and benefit deductions – fall under the umbrella of HR. 
 
Since payroll often forms the largest form of company expense, HR professionals can have a huge influence on business operations, both directly and passively. Things like promotion-based salary increases or performance bonuses all have to be calculated, as does the salary of new candidates and their financial incentives. As a result, HR must enact a fine balancing act when making hiring and promotion decisions, which can have an effect further down the line on the business. 

6. Performance Management and Training 

Another responsibility of the HR department is performance management. Performance management is an ongoing process that involves making sure that employee performance contributes to the organisation’s goals and objectives. This includes employees at every level, from CEOs and management to executive and entry-level positions. 
Building an effective performance management system allows HR managers to oversee the development and progression of employees to ensure they have the skills, knowledge, and expertise to succeed in their role. 
 
Job roles can evolve and shift over time, so a system that managers can use to track progress can be instrumental in supporting business operations. It can inform the performance review process, helping both managers and employees have a clear and accurate discussion about their time at the organisation, how it’s going, if improvements can be made, and how they can receive support. 
 
It also helps managers and leaders to build confidence in their teams based on clear, empirical evidence of their progression and work ethic. By building a level of trust and confidence, teams will be able to do their work without the need for micromanagement, which can have a positive impact on workflow and communication. 

7. Personal/Self-Development 

Performance is intrinsically linked with performance. While it’s important to hire employees who have the skills necessary to perform in their role, it’s equally as vital to invest in their personal development during their time at the organisation. 
 
Helping employees to develop their skills can be incredibly beneficial. New skills can be used to make departments more effective and ensure that organisations keep pace with industry trends and workflows. 
 
HR often create personal development programmes in conference with employees and other stakeholders, such as management. Listening to feedback like this can be revolutionary. Employees have a unique insight into the requirements of their own role – and when they direct their own development, with support from line managers, those needs are more likely to be addressed. 
 
Creating a dedicated personal development plan can have a significant impact on an employee’s performance and wellbeing, which will produce an incredibly positive return on organisations in the long run. 

8. Employee Wellness 

Fostering employee wellbeing is essential, not only for employees on an individual level, but also for an organisation as a whole. Promoting wellbeing can help prevent stress and create positive working environments where individuals and organisations can thrive. As well as increased productivity and retention, wellness programmes can also help to build a healthy, happy workplace culture. HR can play a pivotal role in creating and promoting an effective wellness programme. 
Studies have shown that establishing and maintaining an employee-first culture is known to directly impact the business’ bottom line. Organisations with an effective wellness programme not only work harder, but also learn faster and are more likely to stay with the company for much longer. 
 
By providing a comprehensive programme of support, HR can play a definitive role in creating a mental health-first approach to work culture. As a result, employee experience improves, and engagement and productivity goes up in a way that produces positive business outcomes. 

Choosing The Right HR Support For Your Business 

It’s clear that HR is a truly multifaceted area that interacts with all aspects of an organisation, creating the very foundations on which a business operates. It also covers a diverse array of commitments that are a vital part of business success. Looking at the world of employment today, an effective HR department isn’t just a ‘nice-to-have’; industries have finally begun to realise how integral they are for growth and development. 
 
Whether your HR is in-house or outsourced, having someone to look after employee-related matters will help keep your business grow and evolve. Looking for HR support? Speak to our team today about how we can help you. 
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