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e-HR Management – an inevitable practice by Establishments. A compliance perspective

Posted by: The ADP Team on 24 July 2019 in Compliance, Human Capital Management

(Coffee Break Compliance Guide – Volume 48 by Subramaniam Anandan)

e-HRM is one of the Change Management tool practiced by every establishment globally and specifically in India which automates Human Resources processes.  It is a form of Standardization which has influenced the Human Resource department for efficiency & effectiveness.  A smart and quicker decision is made both by the Project/Reporting Managers and Human Resources through such e-tools.

Such digitization makes the Human Resources a strategic Partner to the Management, which requires when there is a change in workforce attitude, composition and shift in Worker/Employer relationship. Besides, through such digitization the employer may have information for future plan and policy formations, automated employee related information and faster service can be provided in case of grievances, etc. By accomplishing this, are the establishments conforming to the employment legislations?

As such, e-HRM is basically divided into three types

  • Relational e-HRM: Recruitment, selection, on-boarding, training, performance appraisal are few examples of such tool related activities
  • Transactional e-HRM: Compensation and Benefits, Payroll processing and Personnel data administration do come under transactional activities
  • Transformational e-HRM: Strategic support to Management – Change Management and Strategic Competence Management

Functions of e-HRM and compliance requirements

  1. e-Hiring

e-Hiring request and approval: The Hiring request & approval happens through a process where no individual communication is required.

e-Recruitment:  Currently, the employer uses internet, in posting their requirements in job portals or in the career pages of establishment’s home page.  Besides, searching candidates or downloading/ receiving application too happens only electronically.

e-Selection: Even before personally meeting the candidates, a tele-discussion followed by an online test is the order of the day in recruitment.

e-On boarding: Once the applicant joins the establishment officially, he/she has to undergo orientation at various levels.  It includes, understanding the establishment, its vision & mission.  A complete overview, through online presentation, the organization culture and its business is also given to the new joinee.

Compliance Check:  Having its own advantages and disadvantages, the employer needs to check the genuineness of the details mentioned in the resume.  When the employer decided to recruit an applicant, a basic checking of supporting (i) personal, (ii) academic and (iii) experience credentials are mandatory.  Conducting a pre-employment verification is also welcome.  A physically signed application form by the applicant (Resume / Bio-Data / Curriculum Vitae) is necessary.  Personal credentials includes, documents for Name, Date of birth, Address, PAN, AADHAR, etc.  Academic credentials and Experience credentials decide the qualification to place the applicant in a position and to decide on the skill type.

During on-boarding the new joinee shall be informed on the (i) work rules, (ii) attendance/leave policies, (iii) Code of ethics and (iv) an awareness program on POSH, which is mandatory.

  1. e-Attendance & Leave: HR Management system is in place in almost all establishment and there is a flexibility for all employees whoever works in different flexi times and shifts across to appropriately utilise the tool in applying/get sanction for leave. This enables the management to define the work force in advance and review the production strategy.

Compliance Check:  The statutory obligation of employer to ensure the employee performs duty only for 8 hours (or 9 hours maximum) and overtime is payable for such extra hours as prescribed in the provision of Act.  Hence appropriate controls are to be made in the tool.  With reference to the Leave Management the employee shall be allowed to apply the leave and such approved leave shall be accounted for and the wages are processed accordingly.

Where the attendance and leave is directly integrated to the payroll processing, State specific compliances of working hours and leave types are to be suitably incorporated in the tool.

  1. e-Employee documentation: Profiling of employee database, which includes all such credentials of personal, academic, previous experience and assignment skills/competency, etc., provides a central point of access to the stake holders.  Such comprehensive employee database solution, simplifies the Human Resources employee management.

Compliance Check:  The major requirement under employment legislation is, copies of all such credentials are collected and saved physically or electronically.  Any change or amendment or insertion to the credentials are again collected and added to the profile. 

  1. e-Learning: E-Learning refers to any programme of learning.  It is usually an enhancer training where electronic devices are used.  It may be a Web-based learning, Computer based training, Digital activity as a teamwork and more specifically a virtual class room session, which enables the individual to enhance their knowledge and skills.

Such learning are very flexible, as it is made available at “any time”, “anywhere”, which is cost effective as no physical presence of trainer is required and also the work force downtime is reduced. But having disadvantage of personal relationship between the employee and trainer.

Compliance Check:  As part of employment legislation, a periodical updation of service conditions and continuous training on specific employment legislation is mandatory.  Such updation can happen through e-learning or online training or physical training.

  1. e-Performance Appraisal: A Process in measuring the results based on the metrics of every individual employee in all establishment is done only through e- Performance Appraisal tools. The periodical evaluation of skills will ensure each employee understands what is required from them and ascertaining whether the employees possess the required skill to perform the desired job.

Compliance check: Though performance appraisals are for assessment and channeling the talents to the Organizational goal, recently the annual increment and punitive actions are also based on such appraisals.  Appropriate social security benefits are to be considered in case of increase in the wages and provisions of the Industrial Disputes Act is to be taken care in case of punitive actions.

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TAGS: compliance e-HRM Employment Legislation Human Capital Management human resource

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