HR best practice refers to the most effective method of managing human resources within a business. These practices are typically informed by scientific studies regarding employee management and strategy. HR best practices can help businesses improve employee engagement, increase retention, and boost productivity. They also help businesses recruit top talent and establish a positive organizational culture.
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Hr Best Practices 2021
What is the Definition of HR Best Practices?
It is a set of HR activities and principles that work universally to reach a competitive goal, regardless of the organizational type or industry.
Employees are the most valuable resource for a company, a resource that should be perfectly managed and supported. This responsibility mostly goes to the HR department that they carried practicing effective HR policies.
Employees are a company’s greatest asset – they’re your competitive advantage. You want to attract and retain the best; provide them with encouragement, stimulus, and make them feel they are an integral part of a company’s mission.
Anne Mulcahy, BusinessWire
Though every company has its unique needs, there are some basic HR practices and principles. These guidelines should be followed by every good business to ensure their growth. Fundamentally, it is essential to define basic HR aims that revolve around the ultimate goal of the company. So that you can easily build strategic human resource management.
What are the “best fit” and “best practices” in HRM?
According to HRM research, there are two different approaches to managing people within a company.
- The best-fit approach implies that human resource policies should align with business strategy to make it profitable. This means HR should focus on the company’s requirements as well as its employees.
- The best practice approach claims that a certain bundle of universal HR activities exists that supports companies in reaching a competitive advantage regardless of the organizational setting or industry (Redman & Wilkinson, 2009).
In simple words, the best fit is a contingency approach while best practice is a universal approach. The first one is based on the premise that picking the most effective HR policies. Whereas practices depend on matching them appropriately to the organization’s environment.
Often companies prefer a mixed model of best fit and best practice as in reality success lies in between and both have drawbacks as well.
Top 10 HR Best Practices in 2022
We know how the coronavirus pandemic has transformed businesses and workplace culture. Perhaps, employees’ expectations also changed in many ways. The HR best practices of 2022 must reflect these changes into its principles.
Below, we’ve listed top HR Best Practices you should follow to serve the employees of the future.
1. Establish a Friendly WorkPlace
Make sure the employees are comfortable at their work as they might spend most of the productive time in the work premises. Concentrate on their emotional and health safety issues. They should feel that there is someone to listen to their problems and work on them for improvement.
Especially, this year people are going through a tough time. As an administrative person, it’s your duty to calm down your fellow team members with powerful actions. Creating meaningful relationships will minimize their stress and anxiety. This leads to making them productive again.
You may conduct one-on-one routine check-in conversations. So, people can get the chance to open up themselves. Even so, leaders can scan for signs of distress. Monthly or quarterly meet up or surveys might be proven effective too.
2. No Hide & Seek
In these uncertain times, employees are in a dilemma with their future. Transparency is essential to comfort their anxiety and give them confidence. Employers can help with that by sharing regular updates of the company along with the future plan. Remember, it leaves a lasting impression on a company’s corporate culture how leaders behave in tough times.
Also, do not hesitate to share client contact and other relevant business information with the team. It builds a trustworthy relationship and emphasizes the mental ownership of employees to their work. As a result, they become devoted to achieving the company goal as management.
3. Provide Job Security
COVID-19 pandemic is impacting business and economy, globally. There is a wide range of stressors that we are all challenged by to varying degrees. Probably the biggest one is job uncertainty.
Employment security is a kind of assurance in uncertainty that gives reason for employees to work for the company. This security contains two-part where formal contains payment for work. On the other hand, the informal part contains facilities like incentives, bonuses, leave fair assistance, etc.
Job security helps in employee retention which also reduces costs involved in training, education, and establishment. Most of the HR has a sole concern on this. Because whenever employment security is compromised, employees start moving too fast. It endangers the company’s stability and affects the growth rate.
4. Recruit The Best Suit
Recruitment is a door to entering the HR best practices. The company cannot succeed without the best recruitment.
HR can recruit any match but the best suit can add value to the goal accomplishment. Statistics show that a perfect match is about 400% more efficient than an average match employee. Industries to industries or business to business the percentage may vary but the facts are the same.
Out there, HR follows thousands of structured and non-structured techniques to find the best match. However, there are a few common elements HR looks at ability, dedication, skill set, commitment, teamwork, and non-defeated mentality.
5. Establish a High Performing & Self-Motivated Team
Team works are the key to success while team players are the metal. The high-performance team is always successful as teammates contribute differently to achieve a common goal. This contribution contains new sets of ideas, executions, and hard works.
A self-motivated team is psychologically strong and effective in decision-making. Therefore, situations improve which overcomes fences.
In such teams, information is flawless and executions are outstanding. Team meetings also end up with fruitful discussions and directions for future activities. Various project management software, feedback mechanisms, and instant communication apps are very helpful for team management.
6. Fair Evaluation Policy
A fair evaluation system works as a great factor to assure job satisfaction. Based on the performance the fair assessment reduces the dissatisfaction and makes people loyal to the companies instead of a boss.
In addition, the fair evaluation can be a salary increment or employment benefit (position upgrade or additional facility). Also, it can be a team or individual level based on their performance and contribution towards the goal achievement. These incentives, position upgrades, bonuses, facilities, etc. influence to build ownership among the employees.
7. Create Effective Training Programs
HR always uses Training as one of very few effective manpower development tools. HR should plan various layers of training which may include introductory, job-specific, on-job, and refresher training.
Introductory training is mostly conducted for fresher or newly recruited employees to select the best suit. Job-specific training start once HR identifies the best suit. This part is most relevant to what to do and how to do it, which aligns with the company goal. Besides, HR can arrange on-job training to introduce new trends and techniques.
Refresher training is something that reminds of all the forgotten elements. Usually, HR arranges refresher training for employees who did repeated mistakes or join the office after a long vacation. If you are thinking to get back your workforce in the physical office again, refresher training can be effective to make them relaxed.
8. Accessibility to Relevant Information
Without getting the big picture, the ownership does not grow. Relevant information accessibility helps your employee to streamline the workflow with the company’s core objective. Also, it enhances their loyalty toward the organization.
That’s why HR should ensure a flawless information transfer from the senior management to the relevant parties. In that case, any automated system can help you to limit employee access based on their user role.
9. 360 Degree Effective Discussion
An idea can conquer the world. Regardless of the position, an employee can generate something out of the box. Dynamic HR systems always create a mechanism that welcomes ideas from the employee.
Research evidence that cost minimization best ideas is generated from field-level employees who know best about the wastages.
It may surprise you, great organizations initiate reward systems monthly or quarterly basis for the recognition of ideas through financial benefits and/or certifications. This motivates employees to think and contribute towards the goal achievement.
10. Delight employees with Surprises
Human loves surprises. Tiny surprises sometimes boost up output even 100 folds. Considering this fact, great HR always does something innovative to apprise its employees. It may include wishing birthdays, anniversaries, or special moments. In fact, it could be an appraisal for his/her outstanding performance too. These activities are important to show your gratitude to your staff.
Nowadays, HR arranges small to large events to celebrate employees’ special moments arranging cards, cakes, and gift vouchers, etc. Also, you can amaze all your employees together on BIG days like Christmas and New Year. Moreover, making families a part of such celebrations can enhance employees’ satisfaction and engagement with the business.
Special Note: In digitalized organizations, HR modules are an effective tool for reminding these events and measuring employees’ performance.
list of hr practices
We’ve identified the top HR best practices that can give you the most bang for your buck. In other words, if you focus on improving these areas, you’ll likely see the greatest results. These areas include recruitment and selection, training and development, transparency, employee benefits, employee incentives, compensation and evaluations, compliance, and terminations.
1. Recruitment and Selection
Companies seeking to hire high-performers are turning to innovative processes to streamline hiring.
There are many different ways to assess whether someone will be a good fit for the company, both as a high-performer and as a cultural fit. While not every innovative hiring process will be right for your team, you can learn from companies who have paved the way and provided data for the rest of us. Here are a few strategies to consider.
- Panel-Based Interviews: When it comes to interviewing panels, Google’s study of its interviewing practices showed both the ideal number of panelists and ideal number of interviews to be four or fewer. The study showed that scores from a panel of four interviewers made the same hiring decision 95 percent of the time as panels made up of more than four interviewers, and that any interviews beyond four added little or no value to the process. In fact, more interviews simply wasted time and resources and led to disinterest and frustration for both sides.
- Better Advertising for Job Openings: Many organizations are doing a poor job at advertising their open positions and attracting quality candidates. If your company wants to attract top talent and find high-performers, you should not only list what skills you want the employee to have but also give the job searcher a reason to seek out your organization over another.
When it comes to posting the perfect job ad, you should include some information about your organization—what technology you use, what kind of products you create, your mission and vision, and more. Including this contextual information (instead of only a grocery list of skills you’re looking for) can encourage more candidates who believe in your organization’s mission to apply. The best candidates can always learn additional skills; what you want are employees who are going to be engaged from day one.
- Internships: If your company intends to hire the majority of your interns, you should seriously consider paying them. While structuring your intern program, it’s good to know that 60 percent of paid interns receive job offers, whereas only 37 percent of unpaid interns get job offers―only one point better than the 36 percent of graduates who receive job offers without an internship. If you intend to move an intern to a full-time position, invest in them early on.
- Video Interviewing: Video interviewing can be a great tool for saving time and allowing you to get a feel for the enthusiasm and passion an individual has for your organization before you bring them in for an interview. It can also help you weed out potential candidates who aren’t serious about applying because video interviews represent a small investment on the candidate’s part.
- Be Selective: As an HR department, you want to hire the best people who will contribute to the value of your company and not detract from it. Hiring poor performers can really affect your company, whereas hiring top performers can boost productivity by up to 400 percent, no matter your industry or job type you are looking to fill. One way to streamline your process and be selective is to utilize digital tracking. This allows you to keep track of recruitment metrics such as which hiring sources send solid candidates your way, and offer acceptance rates. Knowing which sources send you solid candidates can help you cut down on ineffective referral sources, and knowing what your acceptance rate is can help you fix inefficiencies in your hiring process or inadequacies in your compensation offers. You can also use other tools like interviews, personality assessments, or reference checks to further streamline your process or make it more selective.
2. Training and Development
You’ve taken the time to find employees you want to hire, but your responsibility to them is only just beginning.
It is an HR best practice to invest in training and development opportunities to improve your current workforce, focus on skill-specific training, and realize the value that young workers place on learning. As industries are advancing at an ever-increasing pace, you can support and encourage your employees to grow as well, keeping them more engaged in their work and your organization.
- Invest in Training and Development: Some of the best practices for training employees might involve bringing on interns to reduce training costs before hiring them full-time. Once you’ve found your ideal employees, you’ll need to keep them at the top of their field, and as technology develops at an ever-increasing rate, the importance of training employees cannot be overlooked. If you want your pros to stay pros, you need to keep training them.
- Focus on Skill-Specific Training: Another crucial element HR departments must implement is to focus on skill-specific forms of training. You might have a great general training program, but if you are focused on teaching skills that don’t line up with the work requirements or company objectives, you are wasting time and money.
- Younger Employees Value Learning: HR best practices for training should also consider the fact that many young employees value learning more than their predecessors, and your employee turnover rate could increase greatly if you don’t offer opportunities for growth and development.This is actually great news for employers because it means you have a workforce full of employees who are ready to increase their skills, advance in their careers, and train for new positions.
3. Transparency
A crucial HR practice is to always maintain transparency and be open with employees regarding the success and failures of the business. Organizations that foster an open environment of feedback and communication make employees feel trusted, respected, and valued.
In order to be a high-impact HR department, you should:
- Promote Collaboration and Idea Sharing: Focus on creating an environment that promotes collaboration of ideas and information sharing. Employees who are informed about business operations are better able to share their ideas, and think it’s important to be able to contribute to company decisions that impact their careers.
- Maintain Openness and Transparency: When companies are honest and open with their employees, it promotes a culture of trust between both employer and employee.
As an HR department, you should also avoid focusing on efficiency and cutting costs above all else, as this could actually be less effective in the long run. Instead, promote practices that create transparent environments and encourage information sharing.
4. Employee Benefits
There is a myriad of benefits you can offer employees, but which ones provide the greatest value? The best benefit plans take a strategic approach to accomplishing company goals and retaining great employees as well as ensuring your employees understand their benefits.
- Choose Benefits that Show You Value Employees: Learning from other human resource practices can give you some great insight into where you can focus the company budget when it comes to employee benefits. It also helps you understand which benefits may actually help you retain the best employees. You can choose to provide medical and dental coverage, health and fitness centers, subsidized tuition, or any other benefits that will show you value your employees.
- Use Benefits to Solve Workplace Issues: Google is a great example of using benefits to solve workplace employment issues. Several years ago they noticed that the number of women working for the company was gradually decreasing. Google did some research and found that the decrease was mostly younger women who left to have children. In an effort to retain employees and maintain their bottom line, Google implemented a five-month maternity leave policy with full pay and benefits. This benefit alone led to a 50 percent increase in their retention rate of women.
While Google’s approach certainly isn’t feasible for all companies, it is important to identify where you are losing money and why you might be struggling with employee retention. If you want to hire and keep the best talent, you have to treat them like they’re the best talent and show you value your employees.
5. Employee Incentives
Incentives have their pros and cons. For incentives to be effective, this HR best practice must be implemented in the correct manner, or you risk demotivating your employees instead of motivating them. Here are some HR best practices for providing effective employee incentives.
- Know what Motivates Employees: Some employers have found it helpful to motivate employees by using commision or productivity as an indicator of a raise, and not to limit raises to an annual review or bonus at the end of the year. Employers who simply raise wages once a year regardless of performance are not incentivizing employees to do their best because employees begin to simply expect the raise no matter what.
- Pay Raises vs. Bonuses: As far as the topic of bonuses goes, another study by Google found that employees valued a base-pay raise over a single bonus, because it has long-term effects. So if your company is weighing the overall benefits of pay raises versus a handsome bonus, go with the pay raise.
- Be Creative with Incentives: While HR might hear the word “incentive” and think of monetary rewards, there are other incentives that keep employees motivated, such as a recognition and rewards program or the use of social recognition to acknowledge employees for the work they do.
Providing the right incentives shows employees that you care about them and the value they add to your company.
6. Compensation
If you want great employees, you need to have great compensation plans in place. Above-average employees deserve above-average compensation, and you want to show your employees that you value them and the work they do.
Some HR best practices for compensation include:
- Combining Good Benefits with Compensation: A combination of good benefits and compensation (also known as a total rewards package) can help show employees that the company values and appreciates their contribution as workers and their well-being as people.
- Vary Compensation Options: Upping your compensation offer doesn’t always mean adding more numbers. You could offer other types of compensation such as additional vacation days, gift cards, company discounts, stock options, or profit-sharing.
- Compensation Transparency: A winning compensation strategy comes down to two elements: transparency and communication. A study published by PayScale found that most employees don’t actually know how their pay compares to the rest of the market. Of the employees who believed they were being paid below market rate, 77 percent were paid at market rate, while an additional 12 percent were paid above market rate. Only 11 percent of people who said that they are underpaid actually were paid less than the median market rate. In short, if your employees don’t understand your organization’s comp strategy, and if your leadership never communicates that strategy, then employees are much more likely to become dissatisfied on that point.
Whatever the compensation strategy of your company, it should be based on the productivity and contributions of the employees, and the managers in your organization should be prepared to communicate about it.
7. Compliance Issues
The best way to handle compliance issues is to avoid having them in the first place. That being said, it can be very difficult to juggle the complexities of compliance issues with the daily tasks of running other human resources practices in the workplace. Here are some human resource practices to prevent compliance issues.
- Utilize HR Software: One great way to avoid compliance errors is to use HR software to simplify your HR compliance practices. This will help you find and correct errors quickly and avoid future compliance issues.
- Designate a Point Person for Your HR Team: One of the best ways to stay up-to-date with compliance is to designate a point person for your HR team, who has the responsibility to keep up with new regulations and changing labor laws. They also have the responsibility to convey this information to the HR department, which ensures everyone is on the same page when it comes to legal considerations.
Hiring, employee classification, and wage requirements all require constant attention to stay in compliance. Utilizing your point person and your HR software can help you stay one step ahead of any upcoming changes to HR.
8. Terminations
This is probably the toughest place to implement HR best practices because it will always be difficult for those involved. HR best practices include learning from employees who are terminating their employment as well as understanding which topics to be sensitive of for legal reasons. Issues that may warrant termination should always be addressed before they reach a boiling point. However, when it does come to terminating an employee, you shouldn’t wait on the decision.
- Show Empathy, but Not Sympathy: HR professionals Amy Schrameck and Jeanne Knight recommend informing the employee as to why they are being let go; showing empathy, but not sympathy for the employee.
- Stand Your Ground: Stand your ground even if the employee gets emotional or says they will do better. You should be confident enough in your decision to not waver in your resolve when terminating an employee.
- Conduct an Effective Exit Interview: One of the best practices for HR professionals when going through the termination process (whether voluntary or involuntary) for an employee is to conduct an effective exit interview. A good exit interview can help emphasize things the organization does well and things they could improve upon. Exit interviews should be conducted face-to-face, if possible; otherwise, send a survey and try to follow up on the results in person. You don’t want to make the exit interview feel stiff. Rather, you are trying to gain real insight into what the company can do to retain people in the future.
As you implement these HR practices, you may discover that employees who leave soon after being hired did not have a good indication of what the job entailed when they were hired, and you might consider revamping your hiring process.
Conclusion
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