The HR Audit Checklist for Consultants

A HR audit is the essential first step in a consulting engagement. It examines the current state of compliance and identifies potential liabilities and opportunities, so business leaders can more effectively manage their team.

Insights from an audit empower consultants to move beyond general advice, providing targeted, strategic recommendations. This data-driven approach allows consultants to pinpoint weak spots, mitigate risks and build actionable client plans for long-term success in people management.

We know how useful HR audits can be. That’s why we’ve created a ready-made checklist, as well as some guidance for creating really effective client recommendations.

Download the checklist by filling out the form on the right. 

What is the function of an HR audit for consultants? 

Consultants use HR audits like a health checkup for a business’s people operations. An audit should act as a comprehensive review of a company’s HR systems to ensure they’re compliant with local laws, efficient and aligned with the company’s goals. There are so many moving parts to HR, so this can span a lot of different elements, from company policies to individual contracts.

As a consultant, completing an audit gives you an opportunity to provide valuable advice to your clients, so they can avoid legal pitfalls and build a stronger workplace. It allows you to identify where there are risks in your clients’ HR functions, as well as potential improvements.

Finally, you can offer tailored solutions for those identified issues, such as HR and payroll software that can streamline many of the business’s processes. 

Using audit trail and pay run reporting features for audit insights

To complete an HR audit effectively, you need access to the right data. If your clients use software that enables data tracking like audit trails and pay run reporting, you’ll likely be able to get a lot of key information quickly.

If your client currently lacks effective HR software, this presents an opportunity to guide them towards digital solutions that can significantly enhance future audit effectiveness. For example, Employment Hero’s Employment Operating System makes reporting super simple, keeping all the important data in one safe digital space. Find out how you can connect your client with the latest and greatest technology here. 

How often should consultants conduct HR audits?

The frequency of an HR audit depends on the client’s needs and the industry they’re in. While an annual audit is a great starting point for most businesses, some situations call for a more frequent check-in. 

For instance, if a company is experiencing rapid growth, undergoing a merger or acquisition, or facing significant changes in employment legislation, a quarterly or even a biannual audit might be necessary. It’s all about being proactive. Advising your clients to conduct regular audits helps them stay ahead of potential issues, ensuring their HR practices remain robust and compliant as their business evolves. 

Tailoring HR audits to consulting, accounting and bookkeeping firms

When you’re a consultant working with other firms, like accounting or bookkeeping practices, you need to tailor your approach. These firms often have unique structures, with a mix of permanent staff, contractor, and seasonal workers. An effective audit for them goes beyond basic compliance. You should focus on:

• Contractor management: Ensuring all contractor agreements are compliant and that a clear distinction is maintained between employees and contractors to avoid misclassification risks.
• Data security: Auditing how personal and financial employee data is stored and handled, as these firms deal with highly sensitive information.
• Compliance with professional standards: Making sure their internal HR policies align with the ethical and professional standards of their industry.

By tailoring your HR audit checklist to these specific needs, you’ll be providing a service that’s not just compliant but also strategically valuable.

How Employment Hero supports businesses with HR management

There are so many moving parts when it comes to HR management. Our Employment Operating System handles everything from onboarding to workplace policies and employee engagement. It also acts as a single source of truth for employee records and business data. Best of all, it can support legal compliance with HR and payroll features that update with legislative changes. 

All those common HR challenges, solved with one solution. It offers significant advantages for businesses in Australia.

However, your clients don’t necessarily just need software, right? They need a trusted advisor to guide their digital transformation. 

As an Employment Hero Partner, you’ll be perfectly positioned to:

• Start the right conversations about digital HR solutions
• Demystify automation and AI
• Lead implementation of new tech and training
• Offer ongoing support and advice 

Together, we can help your clients resolve their HR issues, reduce admin and better manage compliance, all while growing your advisory impact along the way.So, why wait? Become an Employment Hero Partner today and take advantage of the unique benefits on offer for both you and your clients.