People Risk & HR Controls

HR Audit — Governance, Compliance & People Risk Remediation

Metrolabs applies a structured, evidence-driven HR audit methodology that blends statutory compliance verification, operational controls testing, and strategic people-risk assessment. We deliver a scored audit, a prioritised remediation roadmap, and governance mechanisms to convert HR from a potential liability into a strategic enabler.

15+
Years experience
500+
Engagements delivered
Enterprise
Clients across sectors
Snapshot — What You Gain
  • Statutory compliance & filings assurance
  • Control deficiencies & remediation plan
  • HR digital maturity assessment (HRMS)
  • Executive-ready audit report & scorecard

Executive Summary

Businesses today operate in a regulatory landscape that is more complex, dynamic, and demanding than ever. An effective HR Audit is no longer a periodic exercise — it is a strategic requirement to ensure workforce compliance, operational integrity, and long-term organizational resilience.

Metrolabs delivers a comprehensive HR Audit framework aligned to industry best practices and global governance standards. Our approach evaluates not only statutory compliance but also HR policy maturity, process efficiency, digital enablement, data accuracy, and workforce risk exposure. The outcome is a clear roadmap that strengthens your HR function and positions it as a strategic enabler of business performance.

  • A detailed view of your HR compliance status, control gaps, and risk areas.

  • Insightful analysis of HR processes, documentation, systems and stakeholder alignment.

  • Prioritised improvement recommendations based on impact, urgency, and compliance risk.

  • A future-ready HR roadmap designed to enhance capability, digital maturity, and governance discipline.

What This Audit Delivers
  • Compliance Scorecard & Risk Heatmap
  • Detailed Findings & Process Gaps
  • HR Documentation & Policy Evaluation
  • Payroll Controls & Statutory Review
  • Actionable Improvement Roadmap

Areas of Assessment — Deep Dive

Our HR Audit framework evaluates your people processes across six critical dimensions. Each dimension is benchmarked against statutory requirements, best-practice standards, process efficiency criteria, and digital enablement maturity.

Statutory & Labour Law Compliance

Assessment of adherence to PF, ESIC, LWF, Bonus Act, Gratuity Act, Maternity Benefit Act, Contract Labour regulations, Shops & Establishment Act and related filings.

  • Returns & registers audit
  • Regulatory exposure analysis
  • Contractor compliance review
  • Penalty & risk forecasting
HR Policies, Contracts & Documentation

Comprehensive review of HR policy architecture, employment contracts, appointment letters, handbooks, disciplinary frameworks, and organisational governance.

  • Policy gaps & alignment audit
  • Employee records & completeness
  • Compensation & benefits documentation
  • Legal defensibility checks
Payroll Compliance & Workforce Financial Governance

Validation of payroll processes, earnings/deductions logic, benefit calculations, and integration with statutory components.

  • Payroll accuracy audit
  • Reconciliation with HRMS/Timesheets
  • Tax & statutory deductions verification
  • Controls, approvals & fraud checks
HR Processes & Workforce Lifecycle

Deep assessment across the Hire-to-Retire value chain — from recruitment and onboarding to performance, exit management and people operations.

  • Recruitment governance & documentation
  • Onboarding vs statutory requirements
  • Performance & grievance management
  • Exit documentation & risk exposure
HRMS, Systems & Data Integrity

Evaluation of system-driven HR workflows, digitization maturity, access controls, and employee data accuracy across platforms.

  • HRMS-to-payroll data match
  • Data quality & completeness check
  • Process automation opportunities
  • Role-based access controls (RBAC)
Workforce Governance & HR Strategy

Analysis of HR’s alignment with organisational goals, leadership involvement, reporting structures, and workforce governance mechanisms.

  • HR structure & capability assessment
  • Strategic workforce planning
  • Governance model effectiveness
  • Leadership insights & decision analytics

HR Governance & Controls Framework

Our governance framework is built on industry-leading HR operating models used by global consulting firms. It provides a structured approach to risk mitigation, decision accountability, process standardisation and workforce transparency across the organisation.

1. Workforce Risk & Compliance Governance

Establishes strong controls to ensure full compliance with labour laws, policies, and audit-ready documentation across all HR domains.

  • Policy enforcement & compliance controls
  • Statutory filings & regulatory governance
  • Risk identification & escalation protocols
  • Vendor & contractor compliance oversight
2. Operational Excellence & Process Controls

Builds consistent, documented, measurable HR processes that reduce risk, improve efficiency and ensure role-based accountability.

  • Standardised SOPs across HR lifecycle
  • Segregation of duties & approval workflows
  • Process automation & control check-points
  • Performance measurement & KPI governance
3. Strategic HR Leadership & Decision Governance

Aligns HR strategy with business objectives through structured governance mechanisms that drive performance, transparency and organisational readiness.

  • HR leadership dashboards & analytics
  • Strategic workforce planning & budgeting
  • Governance committees & advisory councils
  • Data-driven decision support mechanisms

This governance model provides a strong backbone for compliance, operational control, and strategic decision-making — enabling HR to function as a trusted business partner.

People Risk Intelligence Map — P-RIM™

A single-pane view for leadership: impact vs likelihood plotted with contextual commentary, ownership and remediation priorities. Click any risk marker to view root cause, quantification and recommended next steps.

P-RIM™ — Impact ↓ / Likelihood →
Score = Likelihood (1–5) × Impact (1–5). Higher score = higher priority.
Click a marker to view details
L:1
L:2
L:3
L:4
L:5
Impact 5
5
10
15
20
25
Impact 4
4
8
12
16
20
Impact 3
3
6
9
12
15
Impact 2
2
4
6
8
10
Impact 1
1
2
3
4
5
Selected Risk — Insight Panel
Click a risk marker on the map to view detailed commentary, owner and actions.

Priority Remediation (Quick Triage)
  • Immediate (0–30 days): Payroll & statutory fixes, PF reconciliations.
  • Short (30–90 days): Policy enforcement, approval workflows.
  • Medium (90–180 days): HRMS automation, process redesign.

Legend — Risk Bands
Critical (20–25)
High (12–19)
Medium (6–11)
Low (1–5)

HR Capability Maturity Model

A practical five-level maturity framework to assess HR’s capability to deliver compliance, operational excellence and strategic people outcomes. We score across People, Process, Technology and Governance to produce a single HR Maturity Index and a prioritized roadmap.

Level 1 — Ad-hoc
Reactive, undocumented processes

HR responds to issues; limited policy enforcement and no formal controls.

Indicators
  • Inconsistent hiring and onboarding
  • No standard payroll reconciliations
  • Minimal HR reporting
Priority interventions
  • Document basic SOPs for payroll and onboarding
  • Establish primary owners for critical controls
  • Quick reconciliation of statutory registers
Score: 5 / 20
Level 2 — Managed
Defined processes, inconsistent execution

Policies exist but are partially enforced; some reconciliation performed.

Indicators
  • Documented policies & basic HRMS usage
  • Monthly payroll checks on sample basis
  • Defined approval workflows (partial)
Priority interventions
  • Formalise monthly reconciliation & exception logs
  • Enforce offer letter & contract standards
  • Train HR ops on SOPs and compliance requirements
Score: 9 / 20
Level 3 — Integrated
Processes integrated, HRMS-enabled

End-to-end workflows and meaningful KPIs; routine controls & governance forums.

Indicators
  • HRMS → payroll reconciliation automated
  • Monthly governance reviews & owner accountability
  • Documented performance calibration
Priority interventions
  • Close remaining control gaps & formalise RACI
  • Introduce KPI dashboards for leadership
  • Begin targeted automation for repetitive tasks
Score: 14 / 20
Level 4 — Optimised
Continuous improvement & automation

Predictable operations, advanced controls, and continuous performance improvement.

Indicators
  • Automated reconciliations & alerts
  • Control self-assessments & periodic audits
  • Predictive attrition and workforce analytics
Priority interventions
  • Implement advanced analytics and predictive models
  • Continuous control monitoring & SLA reporting
  • Embed HR in strategic planning cycles
Score: 17 / 20
Level 5 — Strategic
HR as a strategic partner

HR drives business outcomes using workforce intelligence and integrated governance.

Indicators
  • People metrics influence board-level decisions
  • Integrated workforce planning & scenario modelling
  • Continuous capability uplift & strategic talent pipelines
Priority interventions
  • Scale predictive analytics and decision science in HR
  • Co-create workforce strategy with executive leadership
  • Design HR-driven value creation initiatives
Score: 20 / 20

Audit Process — Structured, Evidence-Driven

A six-stage, consulting-grade audit methodology engineered to uncover risks, benchmark processes and deliver actionable insights. Every stage is backed by evidence, control testing and HR best-practice frameworks.

01
Discovery & Context Understanding

Leadership discussions to map structure, challenges, workforce composition and compliance exposure.

  • Stakeholder interviews
  • Scope definition
  • Baseline maturity mapping
02
Document Collection & Evidence Validation

A structured evidence-gathering stage covering HRMS, payroll, statutory documents and employee files.

  • File sampling & validation
  • Registers, challans, returns
  • Data consistency checks
03
Process & Control Testing

Deep control evaluation across HR workflows, approvals, compliance, documentation discipline & RACI clarity.

  • SOP & control mapping
  • Role clarity & ownership
  • Gap & control deficiency review
04
HRMS Configuration & Data Integrity

Evaluation of HRMS setups, integrations, access governance, and payroll alignment for accuracy.

  • Master data validation
  • Payroll integration checks
  • Access & security audit
05
Compliance Mapping & Risk Scoring

Each finding is scored on impact, probability & severity to generate a detailed risk profile.

  • Statutory gap analysis
  • Risk scoring (1–25)
  • Root cause classification
06
Board-Ready Report & Roadmap

A structured, actionable roadmap with timelines, owners, heatmaps and transformation priorities.

  • Executive summary
  • 30–60–90 day roadmap
  • Implementation guide

Deliverables — What You Receive

Every HR Audit engagement concludes with a comprehensive set of documents, insights and transformation assets engineered to help leadership take informed, confident and future-ready decisions. All deliverables are structured, evidence-backed and benchmarked against global HR and compliance standards.

Executive Summary Report

A board-ready, distilled view of risks, critical findings and high-priority actions.

  • Top 10 strategic insights
  • Critical compliance deviations
  • People–Process–Tech impact summary
Comprehensive HR Audit Book

A complete evidence-backed audit document covering every observation with proof.

  • Observation → Evidence → Risk → Impact
  • Documented root causes
  • Statutory compliance mapping
HR Risk Heatmap (P-RIM™)

A visual representation of HR risk exposure across People, Process, Technology & Governance.

  • Risk probability vs. impact matrix
  • Severity scoring (1–25)
  • Priority classification
Statutory Compliance Tracker

A complete compliance scorecard aligned with Indian Labour Laws & regulatory frameworks.

  • ESI, PF, Bonus, Shops Act, CLRA & more
  • Mapped deviations & due dates
  • Filing & documentation requirements
Policies & Process Gap Analysis

A policy-by-policy assessment identifying missing elements, outdated clauses & compliance risks.

  • HR Policy Gap Scorecard
  • Missing SOP identification
  • Recommendations for updates
HRMS & Data Integrity Report

A detailed digital audit covering master data accuracy, access controls & system logs.

  • HRMS–Payroll mismatch analysis
  • Access governance evaluation
  • Data quality improvement plan
Workforce Insights Dashboard

Analytical view of workforce patterns, hiring trends, attrition indicators & productivity drivers.

  • Workforce segmentation
  • Attrition early-warning signals
  • Hiring & onboarding metrics
30–60–90 Day Improvement Roadmap

A practical, time-bound action plan for closing gaps and elevating HR maturity.

  • Quick wins (0–30 days)
  • Stabilisation (31–60 days)
  • Strategic enhancements (61–90 days)
Templates, Checklists & SOP Packs

Ready-to-use HR artifacts designed to immediately professionalize and standardize HR operations.

  • HR form templates
  • SOP frameworks
  • Audit-ready documentation packs

Selected Case Studies (Anonymised)

Real-world engagements where Metrolabs delivered measurable HR transformation. All client identities are anonymised, but outcomes represent actual results achieved through structured audits, precision diagnostics and strategic remediation.

Large Manufacturing Group (5,000+ Employees)
Statutory Compliance Transformation

A multi-location audit uncovered critical non-compliances in statutory filings, documentation, contractor workforce management and payroll structuring.

  • 120+ compliance deviations mapped
  • 49% of employee files incomplete
  • Multiple PF/ESI inconsistencies identified
92%+ Compliance restoration within 60 days ₹1.2 Cr Potential penalty exposure avoided
IT Services Company (800 Employees)
HRMS & Payroll Accuracy Overhaul

High payroll inaccuracies driven by incorrect HRMS configuration and insufficient role-based access controls were impacting employee trust and compliance.

  • 400+ master data mismatches identified
  • 17 security vulnerabilities in HRMS
  • 10% payroll mismatch in earnings/deductions
99.7% Payroll accuracy achieved 65% Reduction in HR operational workload
Retail & Distribution Network (2,200 Employees)
People Process Standardisation

Fragmented HR processes across retail stores led to poor documentation, inconsistent onboarding, and high attrition within the first 60 days.

  • Inconsistent onboarding procedures across 41 branches
  • 70%+ documentation errors resolved
  • Lack of standard SOPs & HR governance
38% Reduction in 60-day attrition 100% Standardised onboarding & file management

Frequently Asked Questions

Answers to the most common questions organisations ask before initiating an HR Audit. These insights help clarify expectations, process structure and the value Metrolabs delivers.

Metrolabs performs a full-spectrum audit covering People, Process, Technology and Compliance. This includes employee file validation, HRMS accuracy checks, payroll reconciliation, statutory compliance mapping, policy gap analysis, governance maturity assessment and risk scoring.

Audit duration depends on organisation size, number of locations and data availability. Typical timelines:
• Small companies (50–200 employees): 7–10 days
• Mid-size companies (200–1,000 employees): 12–20 days
• Large enterprises (1,000+ employees): 25–45 days

Only read-only HRMS extracts or controlled payroll data exports are required. We do not request system credentials. All evidence is handled under strict confidentiality with a formal NDA in place.

Not at all. The audit is designed to be minimally intrusive. We coordinate evidence requests, interviews and verifications in planned intervals to ensure HR operations continue smoothly.

Metrolabs follows a strict confidentiality framework. No personal data is stored permanently, all evidence is secured, and access is restricted to the audit team. NDA + Data Security protocols are mandatory for every engagement.

Yes. Once the audit is completed, we offer a structured 30–60–90 day HR Transformation Roadmap and can support implementation, including policy drafting, HRMS corrections, compliance filing alignment and SOP creation.

Internal audits focus on existing processes; Metrolabs brings external benchmarking, statutory expertise, cross-industry insights, risk scoring, and digital accuracy checks. This results in deeper visibility and unbiased findings.

Cost depends on employee size, number of locations, documentation volume and audit depth. Engagements start at competitive rates and include full deliverables, risk heatmaps, implementation roadmap and compliance checklists. Custom quotes are provided on request.