Annual HR Audit Checklist

Why run an HR audit

An HR audit is a health check. It confirms that what your policy says, what your system does and what your records show are the same three things. Most disputes, penalties and payroll leakages start where these three drift apart.

1. Employee records

• Every active employee has a signed appointment letter on file
• Identity, address, qualification and bank proofs are collected and readable
• Date of joining in the record matches payroll and attendance start dates
• Reporting manager, department, grade and cost centre are filled for all
• Separated employees have exit date, full-and-final and relieving letter

2. Attendance and leave

• Attendance source (biometric / app / web) is defined for every category of staff
• Shift, grace, overtime and week-off rules are documented and match the system
• Leave balances reconcile with accrual, availed, encashed and lapsed entries
• Regularisations have an approver trail, not a back-end edit
• Attendance period is locked before payroll is processed

3. Payroll

• Salary structure components are approved and consistently applied by grade
• Payroll register ties to the bank advice and to the accounting entry
• Arrears, incentives and reimbursements have supporting approvals
• Loss-of-pay days trace back to the attendance register
• Payslips are issued to every employee for every month

4. Statutory

• PF, ESI, PT and TDS deductions match the applicable rates and wage ceilings
• Challans are paid within due dates, with proof filed
• Returns are filed for every period, with acknowledgements retained
• Registers and abstracts required at each establishment are maintained
• Contractor and third-party staff compliance is collected and verified

5. Policies and communication

• Each policy has an owner, a version and a review date
• Employees have acknowledged the current version, not an old one
• POSH committee is constituted and the annual report is filed
• Grievance and disciplinary processes are documented and followed

6. Data privacy and access

• Only named roles can view salary, bank and identity data
• Access is removed the day someone leaves or changes role
• Exports of sensitive data are logged and justified
• Data at rest and in transit is encrypted
• Retention periods are defined for each document type

How EmplAI shortens this audit

Most of the evidence above is generated as a by-product of daily use — locked attendance registers, versioned policies with acknowledgement trails, payroll registers tied to attendance, and an access log for every sensitive record. Instead of assembling the audit file, you export it.