How Does a HR Department Affect an Organization?

by Gregory Hamel, Demand Media

Start-up businesses often begin as sole proprietorships or partnerships in which owners are the only workers in their companies. But successful companies tend to hire employees over time to take over basic work tasks and management responsibilities. As a company grows, it may create a human resources department that is responsible for managing employees and their well-being.


One way that human resource departments affect organizations is that they manage employee recruiting, which determines which employees are hired. The recruitment process typically involves such tasks as looking at resumes, attending job fairs and conducting multiple interviews. It is the responsibility of recruiters to ensure that the company hires workers with skills and knowledge that an organization needs to be successful.

Pay and Benefits

Human resources departments are often in charge of handling the distribution of employee pay and benefits, and answering any questions that workers have about pay and benefits. For example, if a worker becomes ill and doesn't understand how his health insurance coverage works, he may turn to the HR department for help. Similarly, if a worker doesn't receive as much pay as he expects, he might ask HR to clear up the confusion. If workers don't receive timely and helpful service from the HR department, it may cause irritation that negatively affects morale or job performance.

Managing Risks

Hiring employees introduces a variety of risks, such as work-related injuries, arguments and insubordination. HR workers are responsible for handling worker's compensation, worker safety, dispute resolution and discipline. The way that an HR department handles these issues can have serious financial consequences on an organization. For example, if a worker complains about a safety issue that results in a injury, she might file a lawsuit against her employer.


In a modern economy, businesses must constantly evolve to take advantage of new opportunities and technologies. A part of this evolution is making sure that workers have knowledge and skills that are on the cutting edge of their fields. Equipping workers with the skills they need to be successful through ongoing training and education is another responsibility of human resource managers.

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