Organisation requires manpower to perform various functions including operating machines (mechanical and electrical).

Personnel department manages manpower, payroll function (disbursing remunerations, leave records, etc.) and their various needs.

We will discuss about staff training in a separate article.

Why Personnel Department critical?

    • Manpower lifeline of the organisation;
    • No manpower = No organisational activity;
    • Even outsourced / contractual manpower requires management;
    • Cordial atmosphere → key for growth;
    • Personnel department is an important bridge between top management and rest others → matching expectations → clarifying various stands taken by each group;
    • Small misunderstanding = lost valuable productive hours.

Functions of the Department

    • Initial Set-up
        • Facilitating inspections and registration of organisation with Statutory Authorities;
    • Recruitment
        • Receiving personnel requests from user departments;
        • Establishing various sources from where personnel can be recruited;
        • Facilitating screening process alongwith user department;
        • Selection of candidate and getting employment agreements / documents signed;
    • New Joiner (entry into the organisation)
        • Arranging access for new joiner in the organisation (attendance register entry / punch cards / biometric, etc.);
        • Registering the employment details in personnel records → informing to Statutory Authorities by submitting the details;
        • Arranging induction training.
    • Monthly
        • Capturing attendance data;
        • Disbursing salary;
        • Maintaining leave records;
        • Deduction of loans & advances instalments, statutory dues like income-tax, provident fund (PF), employees’ state insurance (ESI), etc.;
        • Submission of periodical returns and deposit of tax with statutory authorities.
    • Increments
        • Maintaining employees’ credential records (CR) for performance review and recommending increments.
    • Building relationship
        • Managing labour disputes;
        • Recommending employee for training which we will cover separately;
        • Maintaining cordial labour relations;
        • Carrying staff motivation activities;
    • Ongoing
        • Arranging loans & advances for employees;
        • Handling employee accidents, complaints / grievances;
        • Maintaining various labour records;
        • Facilitating labour officers’ inspections of premises / records;
        • Arranging transportation / safe-reaching of manpower to the office or their residence;
        • Maintaining office quorum or office in order (may be by specifying dress codes, etc.)
    • Employee leaving the organisation
        • Arranging exit interviews and diagnosing the reasons for leaving;
        • Arranging full & final settlement of dues → organising collection of assets given on loan to them;
        • Submission of various forms with statutory authorities (say, PF dept. for employee leaving, claim settlement, etc.)
    • Annual
        • Finalising gratuity, superannuation, ESOP and other short / long term employee compensations;
        • Arranging actuarial valuations of employee dues like leave encashment, gratuity, superannuation;

Deliverables broadly (i.e. expectations from the Department)

    • Arranging the best suitable manpower required by user departments at the earliest;
    • Disbursing manpower’s remuneration timely;
    • Ensuring equilibrium in manpower’s remuneration;
    • Healthy and peaceful human relationship → minimum staff turnover;
    • Bridging the expectations of top management with the rest others;
    • Compliance of statutory liabilities.

Important developments in the Personnel function

    • Salary linked to the employee’s bank account (salary getting transferred to employee’s bank account instead of giving cash / cheque);
    • Online websites for manpower search → online interviews → recruitment;
    • Biometric or retina scanners for employee attendance;
    • Online feedback, suggestions and complaints redressal system with tracking of its status;
    • Usage of personnel software maintaining payroll data, personal data including history of performance appraisals linked with attendance hardwares.

Traditional / Normal ways of working in Personnel function

    • Capturing attendance data manually;
    • Preparing monthly salary payments manually;
    • Non-maintenance of performance reports of employees → adhoc increments without giving credit to performance.

Conflicts (Inter-departmental) / Challenges with Personnel function

    • Biggest challenge → Recruitment of right person for the job at the earliest;
    • Meeting every person’s expectations of providing equitable remuneration is another challenge;
    • Ensuring employees’ safety (especially of women staff) in reaching their residence;

Some of the Process Implementation for better Personnel function

    • Standardisation of processes (document check-list and templates) of
        • Employee joining;
        • Employee leaving.
    • Monthly Reports:
        • Requisition for new employee pending for recruitment;
        • Employee turnover ratio (i.e. number of employees leaving to total employees) and reasons for leaving;
        • Gross Salary (i.e. salary for the full month and not pro-rata to number of days worked) reconciliation with previous month {Gross Salary of previous month (add) Salary of new joiners (less) salary of employees left during the month = gross salary of current month};
        • Statutory dues deposit date of taxes / returns vis-à-vis due date;
        • Any notice, etc. received from statutory authorities during the month; all pending notices; status of notices;
        • Employee welfare schemes pending to be delivered to manpower;
        • Pending suggestions, feedback and complaints of employees.

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