Human resources: Overview, definition, and example
What is human resources?
Human resources (HR) refers to the department or function within a business that manages employee-related matters, including hiring, training, payroll, benefits, workplace policies, and compliance with labor laws. HR plays a key role in ensuring a company's workforce is productive, well-managed, and aligned with business goals.
For example, an HR department might handle recruiting new employees, setting up workplace policies, and ensuring compliance with employment laws such as minimum wage regulations and anti-discrimination rules.
Why is human resources important?
HR is important because it helps businesses attract and retain top talent, manage employee relations, and ensure compliance with employment laws. Without a strong HR function, companies may struggle with hiring, legal risks, and workplace conflicts.
For SMBs, HR is particularly valuable in managing payroll, benefits, and contracts, ensuring employees are treated fairly while protecting the business from legal issues. Even small businesses without a dedicated HR team must follow employment laws and manage workforce needs effectively.
Understanding human resources through an example
Imagine a small business growing rapidly and needing to hire more employees. The HR function ensures that job descriptions are clear, interviews are conducted fairly, and new hires receive proper onboarding. Without an HR process, the business might struggle to find qualified candidates or face legal risks if hiring practices are not compliant.
In another scenario, an employee has a dispute with a manager over working hours. The HR function steps in to mediate the issue, ensuring company policies are followed while protecting employee rights. If the business lacks clear HR policies, misunderstandings could escalate into costly disputes.
An example of a human resources clause
Here’s how an HR-related clause might appear in a contract:
“The Company shall maintain policies and procedures in compliance with all applicable labor laws, including but not limited to employee benefits, workplace safety, and anti-discrimination measures. The Human Resources department shall be responsible for implementing and enforcing these policies.”
Conclusion
Human resources is essential for managing employees, ensuring compliance with labor laws, and supporting business growth. Whether through hiring, payroll, or workplace policies, HR helps businesses create a productive and legally compliant work environment. Even for small businesses without a formal HR department, having clear policies and procedures is key to avoiding legal risks and maintaining a positive workplace culture.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.