Compliance Study of Various Types of Human Resources (HR) Audits in a Multi-Specialty Hospital in Pune City

Introduction

Human Resource (HR) management function is extremely important and has secured a more sophisticated and scientific outlook. Out of all the HR functions, HR audit is a tool that can help the hospital units to remodel HR offerings and systems.¹ Audit can be described as an unbiased examination and evaluation of systems and processes of an organization in order to demonstrate whether they are in compliance with a standard.² HR audit is a process that sets the stage for true transformation in HR strategy and services.^3,4 HR auditing is critical for organisations to enhance performance and incorporate the methodical and regular investigation of managerial practices and activities as against objectives and strategies, legal necessities and occupational standards of an organization.⁵ In today’s competitive environment, organisations must keep up with changing environments and policies. HR audits are essential for review of current HR policies as well as areas where the organisation falls short in maintenance of procedures and practises. It is an opportunity to assess problems and determine what solutions can be used to resolve problematic areas and the goal is not only to control and quantify results, but also to adopt a broader perspective that will aid in defining future HRM lines of action.⁶

HR auditors are well-versed on compliance requirements, risks and current best practices.⁷ An auditor not only conducts audits to ensure that everything is in working order, but it is also a process to determine why the organisation is lacking in some areas and what the errors are. This is a critical component in developing an organization’s promising and satisfactory management. In addition, the audit will show where the gaps are and the strategies to plug these gaps. Hospitals face numerous challenging situations, but it is widely accepted that hospitals with higher adherence to standard practises will be able to improve the healthcare services in the future.

Methodology

This study was carried out at a 900 - bedded NABH accredited multispecialty hospital in Pune city during June-September 2021. The Human Resource Audit Checklist utilizes the tangible and intangible HR and employee-related factors that help to standardise the audit system. As per the NABH guidelines (5^th edition), following are the essential documents to be maintained by HR department which were used for preparing checklist:

• Job description for each category of employee • Background verification of all employees

• Policies of recruitment of employee which summarize criteria for selection and rejection of employees

• Induction training for all new recruits which should cover all the topics such as, vision, mission, and employee’s responsibilities

• Policies, department’s policies etc

• Documentation of training plan along with training calendar, training reports, attendance sheets and feedback of all employees

• Annual health check-up of all the employees

• Credential and privileging policies for doctors, credential documents for each doctor

• All the patient care activities and treatment related documents should be maintained

• Availability of credentialing and privileging policy for nurses

• All the nursing care activities related documents should maintained

In the present study, an audit was conducted for Recruitment, Training, System, and Memo documentation for the last one-year period. Data collection included primary data gathered for each of the four audit processes. The study was carried out in the following three stages as shown in figure 1:

We conducted four types of audits in the hospital:

1. Recruitment audit: This was done with a sample size of 105 and the data collection was done from January to June 2021 (Table 1). Before reviewing all the documents, checklist was completed and analysed on discussion with HRD staff. Prior to beginning the audit process, an analysis and discussion of the checklist was conducted with HRD staff, in which the hospital included all mandatory documents such as manpower requisition, reference check, medical check-up before joining, feedback from the HR interview, interview assessment form, question paper, offer letter and salary letter copy, examining any pending documents in employee’s personal files and documents that may be missing from the HRD and was reported in the final audit report.

2. Training audit: The study evaluated the effectiveness and quality of the training provided within hospitals by various departments in order to perform a training audit. An audit was performed for the month of April-June 2021 by reviewing and observing necessary documents such as mentor assignments, pre and post test questions, feedback forms, and attendance sheets (Table 2).

3. System audit: This was done from April to June of 2021 to see if employee data had been entered accurately into the system. System audits were performed for all the three units of the hospital group. The units were audited for all of the information on the doctors and the nursing department. For all three entities we audited and reviewed, the required documentation included details such as Aadhar numbers, emergency contact numbers, dates of joining, and PAN numbers, as well as previous work experience, department, and designation (Table 3).

4. Memo audit: During April-June 2021, we checked the records of essential documents such as an incident report, a memo request from the Head of Department (HOD), an explanation from staff, a copy of the memo with employee signature, and a counselling register with employee signature (Table 4).

Data was gathered through the checklists for recruiting, training, and system and memo audits. To collect the data for each audit, different checklists were used by examining which, the gaps and requirements for each audit are examined in a systematic manner. Using MS Excel, the collected data was analysed by calculating the final performance of each audit. Each audit’s final performance has been calculated using available and pending documents that define the final HRD performance for each audit.

Results and Discussion

Recruitment Audit: HRD’s overall performance was 96% and almost all essential documents for employee recruitment were recorded in an orderly manner in accordance with NABH standards. Overall performance demonstrates that the HRD was able to record documentation because they strictly adhered to a checklist to maintain documents and kept track of each document.

Training Audit: Training audit showed the recordkeeping performance as 56% which is quite low. This demonstrates a lack of awareness and practice to record training related requirements and maintaining these documents in record with the HOD office. HRD is responsible for maintaining regular contact with the heads of each department in order to complete training and keep records of all the documents.

System Audit: The system was then audited for all the three units. The overall performance across various units was in the range of 93 to 99% indicating HRD compliance in maintenance of all mandatory information for each employee. All of this was being recorded in the system at the time of joining.

Memo Audit: The final audit was conducted for Memo, and the total sample size for the memo audit was 53, resulting in an overall performance of 73% for memo audit. HRD was issuing verbal warnings to employees rather than issuing official notices. The analysis of the audit process showed that the hospital adhered to the internal audit process, which allowed them to keep important documents on file.

The study observations point to a few areas where the hospital HRD was experiencing difficulties, one of which was lack of manpower to maintain files and documents. HR staff already faces deadlines and have heavy workload, making it difficult to maintain files on a regular basis. In such cases, increasing outsourced staff becomes necessary. Furthermore, scanning of critical documentation, which is the most important record of essential documents, is no longer being done. Applicants were unaware of the documentation that they must keep, and applicants were no longer submitting documents to HRD on a regular basis. This is the major reason because of which HRD was lacking to record all the documents in file. The overall performance of the training audit indicates that the HOD and employees were much less aware of the training needs as well as the documents that the department head was required to maintain. HRD was well aware of the fact that they must keep all information in the system, which is feasible because HR chooses to fill out all information at the time of joining. According to the results of the memo audit, HRD was issuing verbal warnings to employees rather than issuing official notices.

Post-audit results aid in identifying bottlenecks and processes that strictly adhere to pointers and rules. Observations from these show that hospitals use their own checklist to keep track of all documents.

There were some bottlenecks that were causing HRD to struggle with maintaining documents such as manpower planning. Another issue was that employees were not fully aware of the documentation process or of the documentation that they are required to submit to HRD. Even after regular follow-up with employees, they refuse to complete their documentation process. HOD’s were also not keeping track of training-related records. All essential documents pertaining to training programmes were not kept on a regular basis by the heads of departments. One of the reasons for low compliance was employees’ lack of awareness and interest in learning about policies and procedures.

To address bottlenecks, HRD can regularly ensure that all processes are followed properly. Quarterly employee input and feedback will also aid in the improvement of processes and policies. Important documents must also be scanned in order to keep all of the files together. Employees should receive external training as well as online training from the hospital in order to gain greater expertise in their respective fields. Hospitals must conduct audits on a regular basis as this is not a onetime event. Continuous HR auditing will ensure that the areas that require immediate attention are identified. All of the processes and practises they employ assist them in aligning with changing regulations and policies.

Similar to our study, other studies also emphasize that Human resources auditing process should be utilized for HR administration by monitoring and collecting information on a regular basis.⁸ Many HR audit studies show that it is far more important to monitor the current state of affairs of HRD in order to fulfil responsibility and gaps. The study assesses the overall performance and effectiveness of the HR department’s procedures. The HR Checklist identifies the responsibilities and factors that managers and HRD staff must adhere to, as well as examines the key areas and findings of the HR audit procedure. The method used to conduct the audit process provides detailed information about the difficult situations and conditions that hospitals face. A more in-depth examination of each audit indicates the current state of affairs. HR audit can be a beneficial tool for evaluating policies and practises, as well as ensuring a safe and pleasant workplace as observed by previous studies.⁹

A quantitative approach was used in a study on the strategic role of HR audit, in which employees involved in the HR audit process participated in a survey. Out of a total of 30 participants, 60% of the respondents were males and 40% were females. 10% of those polled were between the age of 18 and 22 years, 17% were between the age of 23 and 27 years, 20% were between the age of 28 and 32 years, 17% were between the age of 33 and 37, 10% were between the age of 38 and 42, 13% were between the age of 43 and 47, and 13% were over the age of 48 years. The majority of respondents (70%) had 0-5 years of work experience, 20% had 6-10 years of experience, and 10% had 11-15 years of service experience. The vast majority of respondents (80%) were postgraduates, with only 20% being graduates. 30% of respondents were from Top Management, 30% were HR Managers, and 57% were HR Executives. When asked whether HR audit aids in the functioning of the organisation, 90% of respondents agreed that HR auditing is necessary in today’s environment and that recruitment, performance appraisal, and internal communication have improved. Another set of questions were posed about the work environment and majority (90%) of the respondents agreed that HR departments are able to see the bigger picture and work as one of the major growth engines for the organisation, not only identifying the competencies required but also improving the work environment, promoting professionalism among employees, and bringing about a change in the appraisal system. Similar to previous studies, majority (90%) of our respondents also agreed that HR auditing has helped employees clearly articulate the HR department’s goal in order to align HR processes with business goals.¹⁰ In comparison to studies conducted in a strategic role on HR audit, Human Resources audit assists in understanding gaps and aligning HR processes to long-term goals. Human Resource Departments in hospitals have a large responsibility to deal with unexpectedly changing regulations and situations that affect employees’ and hospitals’ desires, so HR functions must be flexible. According to research, human resource auditing is an excellent way to moderate the advancements and effectiveness of human resource capabilities. The study discovered that the documentation for each audit was well-maintained, and the human resource audit procedure had a significant impact on each audit process.

Annual or quarterly evaluation of HR functions of on organization is referred to as HR Audit. Corroborating the findings from previous studies, we found that adding an HR audit to an organization’s regular audit cycle provides important risk coverage that may have been previously overlooked.^11,12 Hospitals conduct audits every six months, similar to an annual health check-up. This allows hospitals to assess where they are now and what they can do to improve human resource functions. The study provides insight into the internal and external processes used by hospitals to conduct HR audits. Internal audit conducted in hospital audit process, Internal audit, when understood in this context, aims to assist members of an organisation in performing their tasks effectively.¹³ Internal auditors personally examine all details to avoid fraud and errors. Following the internal audit process, it will be easier for HRD to keep all records and avoid misunderstandings. An external audit is assigned to a third party who visits the hospital and inspects all required processes.

Figure 2 shows the existing checklist that displays the documents that hospitals use to keep a track of the entire hiring process, which are useful in determining the presence and absence of current documents as well as comparing practises to hospital policies and regulations. HRD is responsible for keeping each employee’s personnel file in the above checklist format.

NABH auditor visits the hospital following the Internal and External Audit processes. NABH audits are performed once every year and a half. NABH auditor examines all files pertaining to recruitment, training, JD, personal information of all staff members, policies, and so on. NABH audit investigates how healthcare organizations enforce all standards. Checklists are created for each process to ensure that the audit is completed in a systematic manner. Internal and external audit processes assist HRD in determining current conditions and improving performance. HRD maintains records in MIS, which were discovered through the internal and external auditing processes. Audit points established by internal and external auditors are recorded in MIS, which is managed by the corporate office. They examine all of the information of each unit, what their current audit status is, and what areas HRD are lacking in order to keep all of the files, all of the details of each unit.

Conclusion

The audit process review for recruitment, training, systems, and memos implies the effective and appreciative functions of the HR department. They also represent the gaps and errors in their performance. Human resource auditing is a technique for examining cutting-edge human resource policies, practices, and documentation. The effectiveness of the entire process is represented by the regular audit display record. HR auditing is a great way to see where hospitals are lacking and the areas they want to improve. Hospitals with effective audit strategies have a much greater impact on the overall functioning, especially HR functions.

Conflicts of Interest

None