What Does HR Do? Key Functions and Roles

HR manages hiring, training, performance, compensation, employee relations, workplace safety, and workforce planning to support organizational success. This article covers essential HR roles, including recruitment, career development, payroll, employee well-being, communication, and administrative responsibilities.

By Douglas Wade, Attorney

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Table of Contents

Introduction

1. Human Resources Planning

2. Recruiting and Selecting Talent

3. Management of Employee Performance

4. Learning and Development

5. Career Planning

6. Evaluation of Roles

7. Rewards

8. Industrial relations

9. Participation and communication among employees

10. Safety and Health

11. Workers’ Welfare

12. Administrative Tasks

Introduction

HR duties include hiring, learning and development, performance appraisal, and more.

We must first review the definition of Human Resource Management, or HRM, to comprehend these particular functions. HRM can be defined as a specific approach to employment management that seeks to develop a highly competent and dedicated staff that can gain a competitive edge by utilizing an integrated combination of structural, cultural, and human strategies. Many people underestimate what HR does beyond hiring and onboarding.

The primary HR functions will be reviewed in this article, along with how they can assist a business to grow and succeed.

1. Human Resources Planning

Knowing what the business will require in the future is the primary role of HR. In other words, what kind of employees will the business need and in what capacity? Selection, hiring, performance management, learning and development, and other HR operations will all benefit from this estimation.

Human resource planning can be summed up as an ongoing, data-driven process that makes sure a firm has the best people in the right roles at the right times to accomplish all of its objectives. Employers who recognize what HR does usually invest in people management.

2. Recruiting and Selecting Talent

Attracting the proper people to join the organization and selecting the best applications from a large pool of candidates is the second role of HR.

Promoting an employer brand is typically the first step in attracting competent individuals. Employers with strong employer brands actually attract 50% more qualified applicants. It is obvious that having a reputable business has many advantages, just as having a bad reputation can turn off potential workers. Regarding the latter, take the cigarette sector, which struggles to attract skilled workers due to its bad reputation.

A company is halfway there when it has a good reputation as a brand and uses the right hiring practices. HR will implement a selection procedure to identify the most qualified and high-potential candidates after they submit their applications. HR must set up a strong hiring procedure since poor hiring practices can result in large declines in productivity—nearly 40%, in fact.

There are numerous recruitment tools available for every stage of the hiring process due to the numerous technological advancements in the field of recruitment in recent years.

3. Management of Employee Performance

Maintaining employees’ engagement & productivity in their roles at a company depends on performance management. Companies ought to set clear objectives, demonstrate strong leadership, and promote candid feedback. They are all essential components.

The current norm is for each employee to receive an annual or biannual performance assessment from a supervisor. Nevertheless, nearly 70% of HR specialists believe that regular, natural dialogue between managers and employees will soon be a part of performance management.

A 360-degree appraisal is a performance management tool that is becoming popular. An employee’s performance is reviewed by colleagues, managers, subordinates, & even customers. This kind of performance management might be helpful in pinpointing potential improvement areas.

Additionally, performance management can assist employees in acquiring competencies and skills that will advance a business by increasing output and general competency.

4. Learning and Development

Business owners should understand what HR does to build a productive workplace. Enabling employees to acquire the skills they will need in the future is one of HR’s main responsibilities. Employee training is actually related to the initial HR function we covered, human resource planning, where HR builds the link between the workforce of today and the one that will be needed in the future.

Traditionally, businesses set aside money for learning and development. After that, the funds are distributed among the staff members. In certain nations, such spending is mandatory. For instance, companies in the UK with annual pay bills of more than three million pounds are required to provide half a percent to their employees’ professional growth and education.

Some nations, including Belgium and the Netherlands, mandate that companies provide for their workers’ learning and development. However, employee development and learning are far less controlled in some nations, like the US.

Almost all businesses understand the value of making investments in the training and development of their employees, regardless of legislative variances. It is the role of the HR department to steer these initiatives in the right direction. Additionally, HR plays an increasingly significant role in upskilling managers & business executives.

5. Career Planning

Career guidance, development, & planning for employees—collectively referred to as career planning—is another essential HR job.

By demonstrating to workers how their objectives can contribute to the company’s future, a firm can increase employee engagement and retention. Better succession planning, a stronger employer brand, and higher productivity are all benefits for the business.

6. Evaluation of Roles

One could consider role evaluation to be a more technical aspect of human resources. Comparing various facets of the entire HR system is part of this duty. The availability of workers, their caliber, the state of the company’s finances, the location of the work, the responsibilities of the job, and the significance of a position to the company are all examples of this. The purpose of function evaluation is to show that comparable roles ought to be compensated similarly.

There are several ways to rank functions internally:

Ranking approach: under this method, functions are ranked by relevant experts based on how much they contribute to the business as a whole. Raters will compare two roles and determine which is more vital to the business. All positions participate in this evaluation, and HR assigns a ranking based on the results.
Classification method: Classification techniques can also be used to classify positions inside an organization. This approach creates a ranking by first classifying a job and then listing it within the designated group. Experience, education, the level of specialized talents needed to do a job, how popular these abilities are, etc., are some examples of categories.
Points method: This approach groups occupations according to what the organization thinks will help them succeed. Each group receives points for each position under this scheme. Technical expertise, problem-solving skills, inventiveness, communication and persuasion skills, business expertise, and other critical competencies are examples of categories. Depending on the business, different abilities will be valued differently.
Personal approach: This approach assesses the individual doing the work rather than the role itself. In this case, the employee’s compensation is determined by their abilities and competencies.

The goal of role evaluation is to help the HR department make sure the company meets its objectives on a strategic level as well as in terms of service and support delivery. As a result, the company can run strategically and provide the necessary level of service.

7. Rewards

Rewarding employees for their contributions is another essential function of HR. Attracting qualified applicants for a position within the organization is mostly dependent on benefits and pay. Benefits and compensation will differ according to the sector, nation, and even culture. Health insurance is usually a desirable part of a job offer in some countries, such as the United States. However, health insurance isn’t a standard employment benefit in nations like the United Kingdom, where the majority of healthcare is already provided by the public health system.

The complete rewards framework defines rewards as much more than just compensation and other material benefits. Additionally, there are relational and psychological benefits to take into account.

Salary increases are undoubtedly one type of reward, but there are other benefits associated with professional development and advancement, prestige, a positive workplace culture, acknowledgment, and a good work-life balance. For example, employees value meaningful work and wonderful coworkers. Thus, the financial compensation for work consists of both economic rewards and extra advantages.

These various elements are combined in the Employee Value Proposition, or EVP. The brand and exterior image of a corporation are distinct from its EVP. This is the image that a company presents to its employees. As a result, rewards are considerably more than just financial. Some overall awards that a company might provide are as follows:

Performance-based incentive
Bonuses
Base salary
Social environment
Status
Job security
Growth opportunities
Alternating work
Formal & informal opportunities for growth
Autonomy
Feedback

8. Industrial relations

Building and sustaining relationships with labor unions and other member-run groups is another responsibility of Human Resources.

Despite a general decline, unionization is still rather popular throughout Europe. According to recent studies, roughly 70 percent of Danish workers are union members, while over 90% of Icelandic workers are. In contrast, only 6% of workers in Estonia and roughly 25% of workers in the UK belonged to a union. In the United States, barely 10% of workers are members of a trade union.

Maintaining positive ties with unions is necessary for seeing potential disputes early on and resolving them. This is particularly important during more difficult economic periods when layoffs are necessary.

9. Participation and communication among employees

Being a reliable advocate for workers is one of HR’s most significant responsibilities. Employees should feel heard and seen, and they should be informed about a variety of issues that affect them. As a subject, communication relates to the sharing of employee-related information.

Being an individual adviser is one of the main HR competencies. People practices, fostering a culture, and serving as a workplace champion and communication specialist are all included in people advocacy.

10. Safety and Health

The development and application of safety and health regulations and guidelines is another essential Human Resources duty. Integrating such rules into the organization’s culture is one of a human resources department’s primary responsibilities.

Let’s look at the petrochemical & energy business Shell as an example. Even at the corporate headquarters, it is not appropriate to climb or descend stairs without holding onto the guardrail. This regulation is part of the organization’s “Goal Zero,” which stands for the objective of having no workplace accidents. Although the regulation is clearly more significant and pertinent to an oil infrastructure, safety is so ingrained in the organization’s culture that rules are followed everywhere.

The significance of workplace safety and health was brought to light by the COVID-19 pandemic. More than 40% of employers say that prospective employees inquire about safety & health procedures. This highlights how essential it is that HR concentrates on encouraging a safe workplace.

11. Workers’ Welfare

It’s useful to learn what HR does on a day-to-day basis. Additionally, human resources is in charge of helping the company’s workers perform to the best of their abilities. This care entails promoting and assisting with one’s financial, mental, and physical well-being.

HR specialists are also supposed to assist workers who encounter difficulties when things go wrong. Problems at work and beyond the office can have a detrimental impact on worker engagement, output, and performance. The bottom line of a company may be impacted by this. Over 50% of workers worldwide acknowledge that they are worried about their financial future, and about 80% of workers report feeling burned out. It is obvious that employee support ought to be a top priority for HR.

An HR department ought to develop a comprehensive plan. It facilitates in-person interactions with staff members. A business may provide a support program for individuals who require mental health counseling. More broadly, the business may organize a day to raise awareness of mental health issues.

12. Administrative Tasks

Administrative responsibility, which encompasses both personnel procedures and HRIS (Human Resource Information Systems), is the final HR role we will talk about.

Paying workers for the hours they put in is known as payroll. HR is often in charge of processing employee paychecks in accordance with the business’s pay schedule and confirming employee hours. The majority of companies employ payroll software, which HR personnel may run. HR departments may also address any queries or worries workers may have regarding their compensation.

HR may also keep an eye on all payments made to temporary workers, freelancers, and contractors. This could entail liaising with any third-party vendors—such as staffing agencies—involved in the worker’s contract and confirming their hours and rate.

Relocations, promotions, illness, discipline, performance enhancement, ethnic and cultural diversity, harassment, bullying, and other issues are all covered by personnel processes.

To effectively handle employee issues, requests, and complaints regarding each of these circumstances, Human Resources is responsible for creating procedures and policies.

Employee data is stored in HRIS (Human Resource Information Systems). To use the data to make well-informed decisions, HR is responsible for purchasing, setting up, and running these systems.

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What Does HR Do? Key Functions and Roles

Introduction

1. Human Resources Planning

2. Recruiting and Selecting Talent

3. Management of Employee Performance

4. Learning and Development

5. Career Planning

6. Evaluation of Roles

7. Rewards

8. Industrial relations

9. Participation and communication among employees

10. Safety and Health

11. Workers’ Welfare

12. Administrative Tasks

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