Social Audits. Employee Relations Audit

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Assertion:

The organization creates a work environment in which all board members, employees, shareholders and contractors interact with fairness, integrity and respect, and in which they can operate to their full potential. The organization’s work environment encourages each person to act responsibly, both individually and collectively, toward a common vision.

Employment Standards:

  • The organization substantially complies with applicable legislation regarding employees, in such areas as benefits, health and safety and working hours.
    • Discuss with management and human resources personnel how the organization determines compensation packages and ensures compliance with all applicable labor laws.
    • Obtain management representation and attorney’s letter concerning the nature of any employee suits that have been adjudicated or are pending.
    • Review any communications with OSHA or other regulatory agencies to determine the number of safety violations/accidents that have occurred within the last year. Compare this number to prior years and to the average number for the industry. Gain an understanding of how the organization reports such incidents. Determine if the organization has taken necessary procedures to rectify any potentially hazardous situation.
    • Ensure that organization communicates benefit packages and all health and safety risks through review of policy and procedures manual and discussion with employees.
  • The organization ensures that its employees are covered under Workers’ Compensation programs in its particular jurisdictions.
    • Review Workers’ Compensation policy and vouch premium payments, as considered necessary.

Performance Review:

  • The organization offers each employee and contract worker a performance and contract review at least annually. This process should provide the employee and contract worker with an opportunity to review management and/or the company, as well.
  • Discuss evaluation procedures with human resources personnel and employees, including an understanding of how evaluations are considered in promotions and compensation and the procedures for upward feedback/360� management.

Compensation:

  • The organization outlines its payment and bonus policies for all departments and levels in the organization. The policy is available for all employees to review.
    • Obtain policy and discuss with human resources personnel. Does the organization regularly review compensation levels to ensure they are in-line with the industry and geographic location? Does compensation include social recognition as well as financial rewards?
    • Interview employees to gauge their understanding of policy.
  • The organization provides opportunities to share in the growth and profitability of the firm through initiatives such as bonus packages, profit sharing, share ownership plans and/or stock option arrangements (if applicable).
    • Discuss current or potential employee incentive compensation plans with management, human resources and BOD members.
  • The organization ensures fair and prompt payment to all employees and contractors for its services.
    • Document understanding of disbursement cycle, specifically controls in place which ensure proper payment.
    • Review accounts payable aging and compare the dates and amounts on issued checks with respective invoices, as considered necessary.
    • Interview employees and vendors to determine if fair and prompt payments are made and how disputes are settled.

Employee Empowerment:

  • The organization creates clearly defined opportunities for management/staff communication and feedback, in all departments and at all levels within the organization.
    • Discuss communication channels with management, human resources personnel and employees.
    • Discuss with management and employees procedures in place to keep employees informed of the organization’s activities. Determine the extent to which future plans are shared with employees.
    • Determine if the organization has a formal grievance policy which is communicated to all employees. What is the process for conflict resolution?
  • The organization provides an effective vehicle for employees to advance ideas and suggestions for change. The company has a clearly defined mechanism in place to ensure a response. It rewards employee suggestions that provide significant advantages to the business.
    • Discuss with management, human resources personnel and employees the organization’s methods to encourage employee creativity. Review procedures for employees to provide input. Determine how employees are rewarded for valuable ideas and outstanding work.
    • If employee input has been provided, review management’s response.
  • The organization provides a work environment that allows for freedom of association.
    • Review employee policies and procedures manual and discuss with management and employees.

Employee Growth:

  • The organization offers clear and documented guidelines for employee development and advancement within the organization. The incentives for advancement are explicit and non-discriminatory. The company supports professional and personal development through internal training programs, financial-assistance and/or flexible work hours for programs outside of the organization.
    • Review development and advancement guidelines and discuss with human resources personnel and employees. Are development opportunities available at all levels? Are employees informed about the impact of technology on their jobs and what actions they can take to prepare? Does a peer counseling or mentor program exist?
    • Determine the number of promotions from within versus external hires, compare to prior years and note trend.
  • The organization has a written policy explicitly defining employee benefits. These benefits may include education, training, health care, childcare and elder care, among others.
    • Review policy and document benefits included in compensation (i.e. life insurance, tuition reimbursement, benefits to same sex partners, etc.).

Employee Termination:

  • The organization has a written policy regarding termination, which is available to all employees for review.
    • Obtain termination policy and discuss procedures with management.
    • Review turnover statistics, compare to prior years and note trend.
    • Review the payroll tax return to determine the unemployment compensation rating and record.
  • The organization follows applicable labor laws when terminating an employee.
    • Determine if the organization has a policy of giving employees a reasonable time to improve before being terminated.
    • Review procedures to determine how severance packages are calculated.
  • The organization investigates, and when appropriate, acts on alternatives to downsizing and layoffs.
    • If the organization has closed facilities or has experienced downsizing, review the process used to inform employees and the community of the layoffs. Was disclosure made completely and within a reasonable time period in accordance with the Worker Adjustment and Retraining Notification Act (WARN)? Did the organization attempt to relocate the employees to other positions within the organization or help find new employment?

Flexible Work Hours:

  • 1. The organization provides a variety of programs to help its employees balance work and family responsibilities. These policies may include flexible working hours, job sharing, parental/family leave policies and telecommuting options.
    • Document availability of such programs through discussion with human resources personnel and employees.

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