What is human resources?

Human resources (HR) is a department within an organization that manages people, supports employees and oversees various aspects of the employment process.

This department works closely with management. It helps them comply with changing labor laws while managing employee benefits and administering much of the hiring process.

An HR department’s responsibilities vary depending on the organization. But generally speaking, HR connects management and employees and plays an integral role in the company’s success.

The purpose of an HR department is to handle the “people” aspect of an organization. HR professionals provide the structure for the organization and work to keep it operating smoothly. They hire, train, and motivate people and serve as a resource for employees.

They are also responsible for ensuring the company stays in compliance with labor laws, defining and enforcing workplace culture, and working with management to create policies and procedures that protect the company and its employees.

HR can also financially impact an organization by helping recruit and retain qualified talent, negotiating benefits packages, and minimizing legal issues.

Though companies may assign different responsibilities to the human resource department, generally, most companies agree that HR is involved in the aspect of the business that deals with recruiting, training, retaining, and compensating employees.

HR works to create a positive workplace and support employees while working toward the organization’s goals.

Here are some of the key responsibilities of most HR departments:

Recruitment and hiring

Recruitment starts with sourcing potential candidates. HR professionals are responsible for placing ads, reviewing and managing resumes, and setting up interviews. They work with hiring managers to narrow down selections that meet the role’s requirements. They may conduct interviews or sit in with the hiring manager.

Once a new hire is selected, HR employees take them through the onboarding process. They provide all the necessary documentation to be signed, review company policies and procedures, and work with the new employee to collect information for payroll and benefits.

Other topics to cover may be company handbooks, uniforms, or any other specific information the employee needs before they start working.

Training and development

HR administers training programs to help employees improve their job performance or develop their skills. Some training is required by law, but some is voluntary. Most employees want their employers to invest in their careers by offering them opportunities to learn new skills or develop their existing skills.

Giving employees the opportunity to develop new skills is essential to retaining them. Even if training is done by another organization, HR is ultimately responsible for identifying the need and scheduling the sessions. Smaller companies may train in house or work with a tuition reimbursement program.

Employee relations

Employees are happier, have higher morale, and are more productive when they work in a positive workplace environment. HR can help with employee relations by engaging employees and asking for feedback on some of their common benefits and policies.

The HR department also offers procedures for dispute resolution. This may not erase the dispute, but it will give employees confidence that they will be treated fairly and with respect.

HR can also work with management to encourage and promote teamwork. They might plan team-building activities outside of work or strategize ways for one team to compete against another for a small reward. Whatever the method for improving employee relations, it can improve the bottom line by boosting employee retention and productivity.

Compensation and benefits

HR works with management to ensure employees are paid a competitive and fair salary. They do this by researching job categories in a geographic location and making recommendations based on the data they compile. They may also negotiate to find the best benefits package for employees. If the benefits change, they are responsible for communicating the changes to employees.

Some HR departments process payroll or work with the accounting department or a third-party payroll company. They are responsible for ensuring that any changes—to payroll, benefits, or personal information—are communicated promptly.

Performance management

HR departments can implement and maintain performance management systems. This allows managers and supervisors to have constructive and consistent conversations with employees about their job performance. HR professionals act as liaisons between managers and their employees to keep the conversation positive while promoting the company culture.

HR is also responsible for ensuring employee files are updated and accessible.

Legal compliance and labor laws

Labor laws change constantly, and federal, state, and government laws must be understood and monitored. Keeping the company compliant is the HR team’s responsibility. Policies must be enforced, workers must be correctly classified, and fair hiring practices must be observed.

Compliance can involve anything from creating and documenting policies to enforcing them. It can also include observing non-compliance.

Each company has its own list of education and experience requirements. Generally, you will need to be a good communicator and computer literate.

A few essential skills are:

• Communication skills: these are essential for any position in human resources. Working in an HR department requires excellent verbal communication plus writing skills for various documentation.

• Being a good listener: as a liaison between employees and management, you should be able to actively listen while noting details and demonstrating compassion.

• Administrative skills: these are essential for organizing, entering data, and multitasking.

• Data literacy: HR is also responsible for analyzing and compiling data about salaries, recruitment, and performance.

• Computer skills: each company may use different programs, but HR employees should be able to use computers and navigate through systems effectively.

• Conflict resolution: employees who work in HR should be good at resolving conflicts, exercising discretion, and presenting a patient and calm demeanor.

Here are some of the most significant challenges HR departments face:

Adapting to a diverse workforce

A diverse workforce can open up some HR challenges. You’ll need to know and address the needs of employees from different age groups, genders, cultures, and nationalities. Though technology has offered advantages in recruitment by increasing the pool of candidates, it also presents obstacles to making local teams more diverse.

Keeping up with changing labor laws

Labor laws are always changing. It can be difficult for HR professionals to stay on top of them. However, failure to comply with these evolving laws and regulations can result in stiff penalties for the employer and negative press.

Addressing workplace conflicts

Workplace conflict is a typical aspect of doing business. However, handling conflict is a challenge for HR professionals.

The HR team is responsible for finding the root cause of the conflict, offering mediation, and helping the parties involved find a resolution. They need to do all this while preventing the conflict from escalating further and having negative effects on the employees and the company.

Managing a labor supply shortage

Another major challenge in North America is the tight labor market. Contributing factors include the following:

• The aging population

• Years of reduced immigration due to COVID-19

• A long-term decline in the labor force

• A lack of childcare

• A surge in early retirements

Human resource management (HRM) is a strategy that manages employees and an organization’s culture. This plan focuses on all phases of the employee’s journey within the organization, from recruitment to retirement or leaving for another job. It allows HR to play an active role in improving the organization’s workforce, saving time and money.

Strategic HRM includes the development and implementation of hiring, keeping, motivating, and managing the workforce while complying with laws and treating employees and employers fairly.

It promotes employee engagement, reducing turnover and providing companies with a competitive advantage. The strategic results trickle down to create added value for customers, stakeholders, and employees.