How to perform a

workforce audit.
M A X I M I S E H U M A N C A P I TA L I N YO U R C O M PA N Y

HOW TO PERFORM A WORKFORCE AUDIT 01

GETTING AROUND

Table of contents.
Introduction 03
What are people analytics? 04
Visa and Certifications Checks 05
Organisational Structure 06
Performance Evaluations 08

Audit Actions
Promotions and Development (Payroll and Salary Checks) 10
Reassignments 11
Warnings 11
Recruitment 13

Checklist 14
Employment Hero 15

HOW TO PERFORM A WORKFORCE AUDIT 02

Introduction.
As dry as it sounds, an essential
part of running a business is
maximising human capital.
Human capital could also be referred
to as the asset that is your workforce.
Your team’s skills, experience, talents
and knowledge - as well as an efficient
business structure that maximises these
qualities - comprise your human capital.
A company with strong human capital
will have a highly-skilled, knowledgeable
and engaged workforce. Management
will know how to get the best out of them
and invest in their abilities. Naturally, the
result of this is often increased profitability
and business growth (the dream!).
On the flip side - a company with
weak human capital will be made up
of employees who haven’t developed
necessary skills, who may be
disconnected from their work or who
are not truly knowledgeable about the
areas they are accountable for. The
layout of the company may also be
misplacing people in different roles - for
example, someone who does not have
the required management skills may have
been delegated several direct reports.
You can probably predict the future of
this company… it doesn’t look great!
Most companies will have a mixed degree
of human capital. Some employees
will be thriving while others might be
drifting aimlessly. This mix can be in flux,
depending on how employees act and
whether the company is conducting
regular and appropriate workforce audits.
Workforce auditing may sound
complex, but there is a framework to
follow that can simplify your efforts.
In every area of your workforce, you
can gather people analytics, which
will simplify your auditing process.
This whitepaper has a focus on the
‘human’ of human capital. Evaluating
employee engagement, knowledge
and performance can be a daunting
task. We’re here to help provide
a blueprint for workforce auditing
that can be achieved analytically
and with kindness and empathy.
Let’s get started!
03
What are people analytics?
People analytics is an essential part of
workplace auditing. Collecting people
analytics involves using a data-driven
perspective to understand how a
business attracts, recruits, engages,
trains, and retains its talent and its
impact on business performance.
In doing so, companies, particularly
their HR departments and leadership
teams, can make evidence-based
decisions using raw and reliable data.
According to LinkedIn’s 2020 Global
Talent Trends report, analytical proficiency
is now considered a core competency
in today’s data-driven environment. 73%
of LinkedIn’s professional respondents
believe people analytics to be a ‘major
priority’ within their organisation.
Human-centred analytics can help • The results can be analysed to identify
businesses make smarter, more strategic any trends or patterns in behaviour
and informed talent decisions. Armed • Lastly, insights can be applied to
with data-driven knowledge, HR and organisational strategies and decisions
leadership teams are better equipped
to source talent, increase performance We’ll be keeping this process in mind as
and improve employee retention. we walk through the workplace audit.
To understand how analytics works, it’s
important to understand the process
behind it first. People analytics is
made up of several vital components
that flow into each other:
• Data is first collected to gather
unique problem-solving insights
• The data is then measured
against previous data, like
historical events or information
04
Visa and Certification Checks.
Visa and certification checks
are a good, technical way to
start your workplace audit.
If you have any staff on working visas,
review these first. Whilst the processes
for renewing will vary depending on
what country you’re based in, doing a
sweeping check of visa validity should be
a relatively straightforward task. Check
the dates of all of your staffs’ visas and
set calendar reminders for when they’re
approaching landmark or expiry dates.
For any work visas that are approaching
expiry, send a reminder email to the
staff member to get any renewal
paperwork in order. There can be
penalties for businesses that do not
comply with working visa terms, so
be sure to stay on top of key dates.
Find more information about working visas
in different countries on these websites.
🇦🇺 Australian Government
Department of Home Affairs
🇳🇿 New Zealand Immigration
🇬🇧 UK Gov Visas and Immigration
Once you’ve evaluated your staff’s visas,
look to their required certifications and
licenses. Certifications and licenses
are different to qualifications, in that
they may expire and need renewal
over varying periods of time.
Some common areas include:
• Alcohol service certificates
• Food handling certificates
• First aid certificates
• Fire warden certificates
• Trades licenses (e.g. electrician,
building, asbestos removal)
• High risk work licenses (e.g.
forklifting, scafolding)
An expired license can incur a
hefty penalty for the employee
and the employer, so this is a
step you do not want to miss! EH TIPS
Make sure that you save a copy Never miss a Visa expiry
of all of this documentation on file, again! Employment Hero
and similarly to the visas, make makes visa management
a calendar note for yourself to easy by sending employers
alert you when your employee’s notifications when a staff visa
certification is approaching expiry. expiration is approaching.
Now that’s out of the way - let’s get
into the nitty gritty of auditing!
HOW TO PERFORM A WORKFORCE AUDIT 05
Organisational Structure.
If you don’t have one already, create a
simple map of your workforce. Starting
from the CEO, let your map flow into
managers and their reports down to the
most junior members of the company.
This simple visualisation can help you see
your entire workforce at a glance, and
give you the chance to look at the raw
numbers. Take a look at your workforce
as a whole. Are there any areas that seem
unbalanced? Are there any teams that
look like they may be underrepresented?
Hold these considerations in your mind.
Next to your workforce map, list all
of your major business projects and
goals for the year. For each person
that will be working on each project,
note the project title under their name.
You’ll likely see some names with long
Janice Jolly
lists of projects underneath them, while CEO
other names will have much less. This
doesn’t mean that the staff members
with fewer responsibilities are doing a
worse job than others, but it does signal
possible under or over-resourcing.
Maude Swanson Buddy Howell Denise Roberts
VP OF CUSTOMER SERVICE HEAD OF RESEARCH HEAD OF IT
Companies change over the years.
Products and services develop and
organisational structures often become
outdated. Your staff allocation may
need to move around to meet the
Thom Newtown Fabrice Dells Mandy Roe
business demands, with different INFORMATION ASSISTANT DEVOPS MANAGER TECHNICAL SPECIALIST
employees upskilling or reskilling.
This simplistic approach shouldn’t be
the entire process - we’ll get more into
skills, recruitment, reassignment and
restructure later in the process. But keep Charlotte Ols Dan McWhite
RESEARCH ASSISTANT RESEARCH ASSISTANT
this simple data collection in mind as
you start your decision making process
and refer to it throughout your audit.
HOW TO PERFORM A WORKFORCE AUDIT 06
An incredibly useful tip for thinking
about team structures - and auditing
in general? Survey your team!
Let’s face it - business owners and
HR managers simply don’t have eyes
everywhere. As much as we may like
to have our boots on the ground in
all parts of the company, our staff are
privy to work, behaviour and processes
to a much greater extent than we
are. Get their knowledge and insights
when doing your workplace audit.
Keep employee surveys confidential to
encourage them to share as much helpful
information as possible. Consider asking
them to ‘agree’ or ‘disagree’ (and provide
their reasoning) with these statements;
• I feel like I need more support in my role
• I would like to take on more
responsibilities in my role
• I find I have very little free time
to take on new projects
• I have access to the things I
need to do my job well
• I have access to the learning
and development tools I
need to do my job well
• My team handles the projects
that we are given easily
• My team is able to respond
to urgent requests easily
• It’s easy for me to prioritise my tasks
Collect this survey data and once
again look for patterns. Does it
match up with the results of your
workforce mapping exercise or does
it show something different?
Both of these exercises should set
a foundation for decision making
around your organisational structure,
but there’s more discovery to do
before we start taking action.
HOW TO PERFORM A WORKFORCE AUDIT
EH TIPS
Employment Hero makes
employee surveys a breeze!
Create and send Custom Surveys
to employees and easily access,
collate, track and analyse this
feedback. Employees will feel
more engaged knowing their
feedback and experiences
are valued. Employees who
feel heard are 4.6x more
likely to feel empowered to
perform their best work.
07
Performance Evaluations.
At this point, it’s time to start looking
at staff performance. This can be an
awkward process, but it’s a necessary
one. In fact, research suggests that
only 29% of employees know whether
their performance is where it should be.
For you to accurately complete your
workplace audit, you need to be on
the same page as your staff members
when it comes to performance.
Ideally, performance evaluations should
be happening throughout the year.
Managers with direct reports should
be across what their staff are working
on and how they are tracking through
their work. This way there will be no
nasty surprises when you look back on
a large period of under-performance
from a staff member, and you can track
any performance issues as they arise.
💡 Our suggested way to do this is with
a regular one on one (1:1) meeting. 1:1s
are a confidential weekly or fortnightly
meeting between managers and direct
reports. They are an effective way
to communicate and ask your direct
report questions in a safe and honest
environment. They’re designed to
increase productivity, engagement and
performance. These meetings are also the
perfect place to track employee goals.
The paper trail of these meetings
will give you a good foundation of
your staff member’s performance
when running a quarterly review
as part of your workforce audit.
HOW TO PERFORM A WORKFORCE AUDIT 8
 Before the review, have your managers
distribute an agenda to the employee
so that they can both prepare
comments and feedback around:
• KPIs and the employees
progress around them
• Weaknesses
• Strengths, and;
• Advantages and disadvantages
that may have had an impact
EH TIPS on their performance
Using a performance review
During the review, have your managers
template for all staff that
talk through all of the points mentioned
is stored in a secure cloud
in the agenda, before opening up
location can make this a
the discussion to leadership and
straightforward process.
communication skills, the employee’s
Check out Employment Hero’s
ability to innovate and their quality of
custom review capabilities.
work. Make sure managers bring a
copy of the employee’s current job
description to compare their official
outlined role with the tasks they Following this process with your
have actually been working on. employees you should have a
much more detailed scope of
Advise taking a gentle and neutral
performance across your workforce.
approach to encourage the conversation
to be as honest as possible. Have We now have three data
managers take notes throughout the collection points to analyse:
meeting about what has been discussed
• Team visualisation and
and share this with the employee, HR and
project distribution
the leadership team following the meeting.
• Surveys from your employees
After the initial review, have managers
organise a second meeting to
• Performance evaluations
discuss actionable points for the Now that we have these three points,
employee. These may include; along with any previous information
• Training sessions to assist in from previous years, we can make
obtaining lacking skills some moves in our audit.
• A development plan to get employees
moving towards a promotion
• An action plan to get the employee
back on track with their goals or
a written warning (we’ll speak
further to this in the next section)
HOW TO PERFORM A WORKFORCE AUDIT 9
Audit Actions.
Ok, so now we’re ready to make some
decisions. Collect all of the information
you have so far and allocate a block
of time to work through it. Prepare
the coffee, it’s time to focus.
Workforce auditing will fall into three
major brackets, each of which will
look to evolve your workforce to
make it more efficient for the future.
PROMOTIONS AND
DEVELOPMENT
Through your audit, you would have been
able to identify some high performers on
your team, who are taking on a lot of work
which is critical to the company’s success.
Consider how you can position your
star employees best to help your
company grow. It may be time to
promote some members of your team
to more senior positions, where they
can apply their extensive knowledge of
the business to decision making roles.
Pull out your staff chart and consider
how this could work. Are you looking
to develop in their area and grow their
team over the next year? A promotion
could be the best course of action.
If you don’t think they’re quite ready for
a leadership role but they’re moving
in the right direction, put together a
development plan that will help them
move into this role in the near future.
Talk to them about their career goals and
let them know you would like to assist
them in growing within the company.
Along with any promotion plans, it’s
also great to reward and recognise
your employees’ achievements. This
shows your employees that you see
their effort, and can not only lead to
better engagement and retention, but
also profitability. Studies show that
companies that effectively appreciate
their employees being 20% more
profitable than those who don’t.
EH TIPS
What about development for your other
When you’re using Employment
staff members that are not necessarily
Hero, you can assign your staff
poised for promotion? You may have
members learning modules
realised that there is a skill shortage
from our in-platform LMS. You
in your workforce that you can help
can track their progress, send
by offering training. Consider using
reminders and easily record their
a Learning Management System
completion of each module.
(LMS), where you can assign your
employees some training modules
to help build their skills. Knowledge
HOW TO PERFORM A WORKFORCE AUDIT 10
sharing sessions amongst your team
is another great low-cost way to help
everyone build valuable skills.
REASSIGNMENTS
So you’ve got some great employees,
but not all of them are performing to
the best of their abilities. Through
your investigation, you’ve discovered
that this is not to do with their skills
or engagement - but is rather due to
a lack of projects or team needs.
The honest truth might be that their role
just isn’t that relevant to the company
anymore. Every day that you have
them in that role, you’re not getting
the full value that they could actually
offer (hello again, human capital).
Take a look around the business. Is
there another area of the team that
desperately needs resourcing? Meet with
the employee to discuss a reassignment
plan. Make sure they know that this is a
positive step - they can move into a role
where they can have more responsibilities
and grow, they have proved themselves
to be a valued asset to the company that
you think would thrive in another area -
and talk about how you can make their
role change as seamless as possible.
Whether you’re promoting or reassigning,
check in with your team’s salaries. A
workforce audit is also the perfect time to
run the numbers on employee salaries,
even for members of the team that aren’t
changing roles. Are employees being paid
equal wages for similar work? Are there
any roles or areas of the business that
seem to be (literally) undervalued? Now’s
the time to sort through these details.
WARNINGS Any of these behaviours should be
setting off red flags in your mind as this
Here comes the really tricky part.
could affect the wider team over time.
No HR manager or business owner
Remember, a team is only as strong as
wants to be the bearer of bad news,
its weakest link. If you have a team of
but chances are your employee data
star employees, along with one low-
is showing that some employees are
performing employee, the low-performing
falling short of where they need to be.
employee in the team could bring
Underperformance, or poor everyone else down to their level. Not
performance, is when an employee only do low performers fail to do their
isn’t doing their job to an acceptable work but they can also distract others.
standard, or is behaving in an
Here’s a framework for conducting
unacceptable way at work. This
an official warning procedure.
can include anything from:
Step 1: Give an Informal Verbal Warning
• Not carrying out their work
to the required standard or
The first step in any official warning
not doing their job at all
procedure is to resolve the issue verbally
• Not following workplace with the employee as part of an informal
policies, rules or procedures warning to advise them that they aren’t
meeting their role expectations. While
• Unacceptable behaviour at work,
this isn’t written, you do need to detail
eg. harassment or bullying
the specific areas of underperformance.
• Disruptive or negative
behaviour at work
HOW TO PERFORM A WORKFORCE AUDIT 11
Keep a note or email your employee Step 2: Give a Formal Written Warning
following any verbal discussions you
This warning should be written in
have about their performance. Doing
the form of a letter that’s personally
this will make sure everything was
addressed to the employee. Make sure
clear. It also ensures that you have a
you reference any verbal conversation
written record of the topics that were
and warnings that have previously
discussed, as well as an audit trail.
been issued, along with the dates that
After you have explained your concerns these informal warnings were issued.
to an employee and provided them
In a formal written warning
with strategies on how to improve
you also want to:
performance, regular follow up
meetings should be held. These can • Specify details of the areas where
be used as an opportunity to talk about your employees was, and still
progress. See if there’s any further is, underperforming (providing
help or support the employee needs. examples if/when possible)
Where performance has improved, you
• Create an action plan and communicate
should make sure to recognise this.
dates to check-in with your employee

If verbal warnings don’t garner • Make sure it’s 100% clear that another
any changes, you may want warning letter could be issued or any other
to move on to Step 2. consequences (e.g. termination) if the
employee does not meet your expectations

• Reassure your employee that the

warning is completely confidential

HOW TO PERFORM A WORKFORCE AUDIT 12

Once the warning letter has been sent,
we advise setting up another face
to face meeting with your employee
to discuss the letter in person.
Step 3: Consequences
Termination should only be considered
as a final resort. Different termination
laws apply in each country, so look
on your Government website to make
sure that you are complying with
your nation’s employment laws.
What extra roles in the company
would help your team complete their
projects faster, and of higher quality?
What areas of the business are you
looking to expand? What projects
will take place in the year ahead?

Suppose the employee hasn’t changed

their behaviour and continues to
underperform after multiple informal
and formal warnings. In that case,
the employer has the right to act out
consequences as long as they were
clearly outlined to the employee.
If they have clearly explained the possible
consequences of the employee not
improving (including termination), then
the employer has the right to action this.
RECRUITMENT Whether you start recruiting immediately
or make a recruitment plan for the
Returning to the lighter side of workforce year, congratulations! You’ve just
auditing, we’ve come to our final completed your workforce audit.
stop of audit actions - recruitment!
By now you have a pretty thorough
understanding of your team and
company’s needs. You’ve identified some
gaps in your organisational structure,
you’ve made some promotions and
you’ve shuffled some staff around.

It should now be quite clear exactly

which roles are missing from your team.
If you need any further information -
return to your employee surveys and see
what they’ve recommended and seek
input from your management team.

13
Workforce Audit Checklist.
☐ Check team visa expiry dates ☐ Organise training or skills

☐ Check team certification development sessions

and license validity ☐ Organise any reassignments

☐ Create organisational structure chart ☐ Deliver any necessary warnings or

☐ Allocate major projects and task performance improvement plans

against organisational structure ☐ Identify any potential

☐ Conduct employee survey roles for recruitment

☐ Conduct performance evaluations ☐ Relax after a job well done,

knowing your workforce is poised
☐ Promote employees (or flag
employees for promotion)
for growth and greatness 😉

HOW TO PERFORM A WORKFORCE AUDIT 14

Employment Hero can help with every area of workforce auditing.
We’re your all-in-one HR software,
built to make employment easier and
more rewarding for everyone.
Vevo Reports: With Employment
Hero, you can run VEVO reports to
check on whose visa is coming up
for renewal. This process can also be
automated, helping you stay ahead of
any potential visa renewal issues.
Organisational Charts: Understanding
who everyone is and what they
do inside a business can be hard.
We’ve made this aspect of employee
management simple by including an
organisational chart inside the platform.
We also have a staff directory to make
it easy for everyone to stay in touch.
Performance Review: Our performance
review templates can be used for
performance reviews and just about
any other kind of review your business
needs! Using Employment Hero,
you can create templates for the
different types of reviews that you
want to run inside your business.
Learning Management System: Develop
your people and your business by
creating customised learning paths
in our Learning Management System.
Managers and leaders can quickly see
the status of a particular course and
make sure their employees are on track
with their continual development.
Applicant Tracking System (ATS):
Employment Hero’s ATS software is
a robust solution for total employee
lifecycle management from Hiring and
Onboarding to Off-boarding. Save
time and money on recruitment as we
automate a range of recruitment tasks.
Want to learn more about how
Employment Hero can simplify
workforce auditing?
Book a demo with one of our
business specialists today.
HOW TO PERFORM A WORKFORCE AUDIT 15
Looking for an
HR solution?
If you’re looking for an all one HR and payroll
system that can assist with improving communication,
Employment Hero can help. Employment Hero
can help your team stay engaged, motivated
and strategically aligned with our range of
features including:

• 1:1s
• Feedback 
• OKRs (Objectives and Key Results) 
• Paperless onboarding
• Timesheets
• Leave management
• Employee happiness surveys 
• Learning management system
• Reward and recognition 
• And so much more…

BOOK A DEMO WITH ONE OF OUR

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HOW TO PERFORM A WORKFORCE AUDIT 16