In smaller organisations, human resource issues are typically handled by the owner. The owner is involved in recruitment, planning compensation and benefits, orientation and other human resource related issues. As the organisation grows and more supervisors are recruited, the owner may delegate some of these functions.
The supervisors handle human resource issues, for example in mid-size companies, the accountants may handle payroll administration.
Organisations without a specialised human resource department run the risk of mismanagement if the persons handling HR issues are not trained. For example, an owner who has not been exposed to any human resource training may run the risk of non-compliance with mandatory legal requirements.
I would advise training for non-human resource personnel involved in managing human resources. This will go a long way in building managerial capacity in handling human resource issues, therefore, minimising risks and enabling the business to have optimum management of the resource.
If your organisation can afford it then it may be worthwhile to consider setting up a human resource division. The recommendation is to have a professional recruitment agency recruit the right human resource personnel for your division.
They will be looking at issues such as competence, professional skill and knowledge, experience and wide skill set such as human resource personnel with labour law knowledge.
Once you have sourced the right people it is important to have a plan for the department and this includes issues such as their role, budget and so on.
Having in place a human resource department will assist your organisation manage staff well and gain maximum value out of people.
The role of human resource includes recruiting the right staff members, maintenance of a safe working environment, managing the relationship between the employer and the employee, setting the compensation and benefits, legal compliance, training and talent management.
Despite the importance and role of human resource in an organisation, there are several cases of malpractices by the human resources personnel and this can have a negative effect on the business. Malpractices by human resource can demotivate the staff and expose the organisation to lawsuits.
Recruitment malpractice is one of the most common. This includes favourism and discrimination during the recruitment process. Furthermore, some human resource personnel engage in corruption whereby jobs are given to the highest bidder.
Mismanaging conflict of interest can also amount to malpractice. Human resource personnel have to manage competing interests between their employer, employees and other stakeholders such as government.
How well human resource personnel balance the competing needs determine whether it will amount to malpractice or not. At times the human resource personnel are more skewed to the interests of the employer at the expense of the staff.
Other major issues of malpractice include breaching employee’s confidentiality and data privacy rights. If an employee discloses something personal and confidential to the human resource, then it would be unethical for the human resource personnel to breach privacy laws by unauthorised sharing with third parties.
Despite this being unethical it still happens a lot. In some instances, human resource personnel have been the source of rumours, gossip and other work place ills that create a toxic work environment for the staff.
As owners it is important to keep an eye on your human resource personnel and hold them accountable through performance contracts.
It is important to have an independent whistle blowing mechanism or a way in which staff aggrieved by the human resource personnel can air their grievances.
Many employment and labor lawsuits arise out of mismanagement by human resource personnel.