Understand how strategic HRM works, and its relationship with business strategy, human capital management and business performance
HR policies provide written guidance for employees and managers on how to handle a range of employment issues. They play an important role in practically and effectively implementing an organisation’s HR strategy. They also provide consistency and transparency for employees and managers, helping to enhance the psychological contract and create a positive organisational culture.
This factsheet looks at how organisations can benefit from introducing HR policies, the people responsible for developing policies in different-sized organisations, and the types of policies which should be introduced. It also provides guidance on implementing HR policies, from auditing to benchmarking, consultation and drafting of new policies, to ongoing review. Finally, the factsheet offers advice on writing and communicating policies to different sectors of the workforce.
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HR policies can play a key role in supporting fairness and consistency across an organisation, as well as helping to protect the organisation against legal claims. However, no matter how well any policy is written, it’s their effective communication and implementation, particularly by line managers, that’s crucial in ensuring their effectiveness.
In most organisations today, the remit of the HR function has moved far beyond the setting of policies, with HR teams becoming increasingly strategic and focused on creating environments of enablement rather than control. Over and above offering guidance on individual and organisational responsibilities, HR policies should support the wider strategy through adopting a tailored approach that reflects the size and unique culture of the organisation.
Whilst implementing multiple detailed policies may work effectively for some organisations, fewer or more principle-based policies may work better for others. We encourage organisations to focus less on what’s worked well for others (often labelled as ‘best practice’) and focus more on deciding what will work for them to help create sustainable and successful relationships between people and the organisation.
What are HR policies?
HR policies are a written source of guidance on how a wide range of issues should be handled within an employing organisation, incorporating a description of principles, rights and responsibilities for managers and employees.
Links between HR policies, procedures and strategy
HR policies should flow from HR strategies, and complement HR procedures:
An HR strategy is a statement or framework determining how HR can support business or organisational objectives, focusing on longer-term people issues and macro-concerns about structure, values, commitment and matching resources to future need. Read our Strategic human resource management factsheet.
HR policies provide general and practical advice and guidance for managers and staff on a range of employment issues.
HR procedures support and supplement HR policies where appropriate by giving a step-by-step account of specific arrangements that apply in particular circumstances (for example, setting time limits within which meetings must take place).
Why introduce HR policies?
In today’s rapidly changing world of work, characterised by increasing complexity and uncertainty, it’s becoming more important than ever for HR to foster cultures of trust, fairness and inclusion. HR policies play an important role in supporting such cultures by outlining the responsibilities of both employer and employee in the employment relationship. They can impact on employee motivation, organisation reputation and the ability to attract and retain talent. Introducing these policies can support the attitudes and behaviours needed for sustainable performance, creating mutual benefits for employees and organisations.
HR policies can also speed the decision-making process by ensuring that clear guidance is readily available to cover a range of issues. Most importantly for many organisations, HR policies can help avoid involvement with employment tribunal claims by providing guidance for managers that accurately reflects the prevailing regulations.
Certain HR policies and procedures are specifically needed to comply with legal requirements. For example, a written health and safety policy is required for any organisation with five or more employees, while there are also important legislative provisions surrounding the setting out of formal disciplinary and grievance procedures.
Even where a policy or procedure isn't specifically required by law, employers often find it helpful to have a policy in place to provide clear guidance that reflects the legal framework for handling the issue in question and it also helps employees to be clear about the organisation’s stance on a particular subject.Organisations introduce or review specific HR policies for a range of reasons including:
- to reflect and comply with existing or new legislation, including European directives and case law
- to support business strategy
- to follow the latest developments in effective people management
- to deal with internal change
- to comply with head office/parent-company guidance to keep up with competitors – for example, reward policies may be reviewed in order to attract or retain employees when operating in a different international market
- for smaller organisations, a desire to develop a more formal and consistent approach that will meet their needs as they grow.
Who develops HR policies?
Organisations tend to develop formal HR policies as they increase in size – although there is no set formula to help organisations determine the point in their development at which they need to employ an HR professional.
Typical examples of practice across organisations of differing sizes include:
Small organisations - HR policy development is often added on to the existing duties of an employee or employees (particularly with an aptitude for people management) or a specialist may be employed on a one-off consultancy or part-time basis to develop or review specific policies.
Medium organisations - An HR generalist may be tasked with introducing new policies, reviewing the existing ones and communicating them to employees and managers.
Large organisations - HR and learning and development (L&D) specialists are often employed to deal specifically with key issues such as reward, employee development, employment law or employee relations, supported by HR generalists and administrative support staff.
For further details on different HR roles, our comprehensive Profession Map looks at the competencies needed by people management and development professionals.
Find out more about the Profession Map.
Which HR policies should be introduced?
It’s difficult to identify a comprehensive list of HR policies that employers should introduce since, as noted above, HR policy needs often vary widely between organisations. There’s no one-size-fits-all approach to designing effective HR policies; their content should be based on the unique needs and characteristics of the organisation and its workforce. Rather than following a ‘best practice’ approach which may be unsuitable for the diverse range of organisational contexts, a focus on why there’s a need for a particular policy, and how it’s aligned with the business strategy, allows an appropriate policy to be implemented for the particular context. HR practitioners need strong professional judgement to create policies that promote two-way relationships between their people and the organisation. Find out more in our research report From best to good practice HR: developing principles for the profession.
It can be helpful to consider the type of policies that may be relevant to the organisation during the course of the employment life cycle: beginning employment, during employment and leaving employment.
An organisation might have a distinct policy setting out its criteria for selection, together with other relevant policies for new joiners such as induction. Other examples of policies in this area might be referral payment (for existing employees who recommend friends).
Policies might address areas such as how jobs are graded and how performance is rewarded; together with provisions for aspects of compensation packages, such as pensions/additional voluntary contributions and other benefits and allowances.
Health, safety and well-being
Policies might cover a disparate range of topics from prevention and management of work-related stress to handling hazardous materials.
Employee relations and general HR issues
As well as disciplinary and grievance policies, examples include: time off and leave for trade union activities, holidays, secondment, volunteering, parental or caring duties (such as maternity or paternity leave), communication, involvement and other employee behaviours, including employee voice and harassment and bullying.
Learning and development
Issues that might be covered by policies in this area would include courses and secondment opportunities, talent development, payment of professional fees and so on.
Other policies that organisations may want to consider include diverse areas related to the wider business needs (for example corporate responsibility or anti-bribery measures) or those associated with emerging technology and new ways of working (the use of social networking sites, for instance).
There are many reasons why employment ceases, from voluntary resignation to dismissal, redundancy or retirement – some or all of which might be covered by formal written policies (for example, including information on the length of notice periods or the nature of redundancy consultation).
Managing equality, diversity and inclusion
Equality and diversity runs through all aspects of an organisation's policies. Discrimination on many personal characteristics, such as gender or race, is unlawful at all stages of the employment life cycle, while managing inclusion and valuing diversity is central to good people management and makes good business sense. Good practice suggests that an overarching equality and diversity policy should expressly inform the organisation's vision and values. The issue might then also be incorporated into many other policies (for example, recruitment and selection and reward).
Beyond the organisation
In some cases HR policies may need to extend beyond the organisation, for example in partnering arrangements such as joint ventures, outsourcing, strategic alliances or public-private sector commissioning models. It's advisable to consider where common policies may need to be applied or reviewed in light of new organisational arrangements. Find out more about our Beyond the organisation research.
Sourcing information for HR policies
When developing new policies or revising older ones, numerous sources of information are available.
Many of our factsheets and guides provide suggestions for what could be included in a particular policy and, for CIPD members, our employment law Q&As have fuller details on legal requirements - explore the Knowledge hub to find these by topic.
In-depth guidance on HR policy development, together with a wide range of model policies, procedures, letters and forms, is available from our subscription service HR-inform.
Some organisations (particularly in the public sector) make their policy manuals available via the internet. These are often a good starting point for drawing inspiration, but it's vital to assess the reliability of the source (date of production, size of organisation, culture and so on).
Many commercial organisations offer ready-made policy solutions, usually for a fee, which can be tailored to suit individual employers. But, again, assessing the reliability of the source is essential.
It's particularly important to check any relevant codes of practice to ensure compliance with legal requirements.
Guidelines for introducing and reviewing HR policies
The following guidelines may be helpful when introducing and reviewing HR policies:
Assess/audit current practices and what already exists, whether formal or informal.
Research and benchmark against other organisations' practice, particularly in the same sector or location.
Consult with staff representatives and/or unions.
Establish steering groups/working parties to develop the policy.
Set realistic timescales.
Pilot draft policies.
Give specific guidance to managers.
Include the policies as part of the induction process.
Have a continuous review process.
Ensure policies are complementary, flexible, practical and enforceable.
Writing and formatting HR policies
All policies should be written in plain English. Avoid jargon so that they're user-friendly and easily understood by all employees. When unavoidable, include a short glossary of technical terms. It may be helpful to include a date of publication and/or most recent review.
Policies should also indicate who should be approached with queries about the content and who is responsible for updating and reviewing them. It’s important not to assume that the current policies in place are always the right ones. Some policies are reviewed at regular intervals, for example, the policy on mileage allowances might be revised annually to take account of movements in inflation or the taxation regime. Others might be reviewed in the event of legislative developments or simply on an ad hoc basis.
Communicating HR policies
Turning HR policy into practice requires working across the business to ensure that leaders, line managers and employees fully understand the policies and expectations (including any updates). The format for communications will depend on the organisational culture and nature of the policies. See more in our factsheet on employee communication.
Since line managers are pivotal in bringing HR policies to life, training is crucial to ensure that managers have a clear understanding of the policies, and have the capability to implement policies sensitively and fairly. Read our factsheet on the role of line mangers in HR and L&D or listen to our podcast on training line managers.
Induction plays a key role in making sure new employees are aware of all the policies and procedures within an organisation.
Useful contacts and further reading
Books and reports
CUSHWAY, B. (2016) The employer's handbook 2016-17: an essential guide to employment law, personnel policies and procedures. 12th ed. London: Kogan Page.
HARDING, S. (2015) Employment guide to procedures. Bristol: Jordans.
HUTCHINSON, S and PURCELL, J. (2003) Bringing policies to life: the vital role of front line managers in people management. Executive briefing. London: Chartered Institute of Personnel and Development.
MARCHINGTON, M., WILKINSON, A., DONNELLY, R. and KYNIGHOU, A. (2016) Human resource management at work. 6th ed. London: Chartered Institute of Personnel and Development.
Visit the CIPD and Kogan Page Bookshop to see all our priced publications currently in print.
GREENE, R.J. (2007) Effective HR policies and practices: balancing consistency and flexibility. WorldatWork Journal. Vol 16, No 2, second quarter. pp70-81.
HOWSE, M. and ASH, S. (2015) Five ways to make sure global HR policies succeed. Employer's Law. March. pp12-13.
KINNIE, N., HUTCHINSON, S. and PURCELL J. (2005) Satisfaction with HR practices and commitment to the organisation: why one size does not fit all. Human Resource Management Journal. Vol 15, No 4. pp9-29.
CIPD members can use our online journals to find articles from over 300 journal titles relevant to HR.
Members and People Management subscribers can see articles on the People Management website.
This factsheet was last updated by Jo Brimacombe, HR Business Partner, CIPD.
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