What is HR Compliance Management System? | How to Choose Best HR CMS in 2023
Category: HR & Payroll, Posted on: 19/01/2023 , Posted By: Webtel
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What is HR Compliance Management and why is it important?

Human Resource planning and management are evolving at a fast pace in an attempt to keep up with the ever-changing work environment. Organizations are moving away from the traditional management practices and starting to adopt new ways and measures to establish an effective HR management system.

The list of factors that affect the decision-making process in human resource management is never-ending. One such factor that the management has to take into consideration at the policy formation stage is human resource compliance management. But before diving into the topic of HR compliance management, it is important to understand the basic meaning of HR compliance.

Human resource compliances can be defined as the set of rules and standards that direct the human resource planning and management and set the benchmark for all HR management practices. Aligning these standards with the overall objectives of the management is human resource compliance management.

Why is HR Compliance Management necessary in an Organization?

  1. One of the main reasons why human resource compliance management is essential for any business entity is, that the absence of the same might lead to implications from a legal standpoint.
  2. Moreover, human resource compliance management sets the base for an efficient HR management system, ensuring the interest of the organization as a whole.

  3. HR compliance also provides a framework for setting up the policies related to human resource management.

  4. Optimal management of HR compliance also ensures that the workers or employees are not being exploited and their interest is protected.

  5. Lastly, setting up a management system following the guidelines provided under the laws also ensures the smooth functioning of the business organization.

How can you ensure proper HR compliance management in your organization?

To be able to comply with the rules and guidelines set up for HR compliance management, it is important to be aware of the said rules. Keeping themselves updated with the changes, if any, in the legal, social or technological environment and reflecting these changes in the management policies is a crucial part of HR compliance management.
However, updates and changes will hold no meaning if the workforce is not aware of the same. The implementation and reinforcement step is as important as planning for human resource compliance management.

Following the planning and implementation stage, conducting audits to compare the effectiveness of the new policies with the desired objectives and making sure that these guidelines are being followed is an unavoidable task for efficient HR compliance management.

What is a Human Resource Compliance Management System (HR CMS)?

Keeping track of all compliance management steps manually is not only tedious but also subject to errors and inaccuracies. HR compliance management system is essentially a virtual assistant that simplifies the process of compliance management in human resources with the help of smart custom features that make the maintenance of regulatory compliance easy and helps in the improvement of the company’s overall HR compliance management program.

How HR CMS Simplifies HR Compliance Management?

  1. Risk Management

  2. Non-compliance with the legal and statutory laws associated with human resource management can risk the reputation of the organization and expose the firm to cost penalties. A human resource compliance management system evicts possible risks and penalties associated with such defaults by the means of programmable alerts, form filing features, eligibility status, and so on.

  3. Automation

  4. An HR CMS automates most of the compliance management activities of the HR department, providing accuracy and timeliness to the work. Taking the burden of manual research and filing procedures, the HR compliance management system spares the time of management and helps them in paying attention to other areas of work.

  5. Accuracy

  6. By integrating the database and automating the process of compliance management, the HR compliance management system ensures accuracy in the work processes and calculations, such as TDS filing, calculation of statutory bonus, PF returns, and other legal obligations related to human resource compliance management.

  7. Timely Compliance

  8. The human resource compliance management system assists the management to keep a track of deadlines and hence, avoid penalties associated with the same. By providing regular updates and alerts related to important dates and deadlines, HR CMS makes the human resource compliance management process quick and simplified.

  9. Centralized Data

  10. An HR compliance management system essentially provides a centralized location for all the compliance management needs such as form 16 generation, ESI return, PF filing, tax deductions, and other statutory obligations. This reduces the workload of management and increases their efficiency.

How to choose the best HR Compliance Management system?

The choice of an HR compliance management system largely depends on the objectives of an organization and the areas where assistance is required. The key features that the management must consider while making this choice are:

  1. Privacy and Security of your data should be a priority while looking for an HR compliance management system. The absence of a data protection system endangers both the business as well as the employees and put them at risk of cyber threats.

  2. Aligning the features offered by CMS with the objectives of management is a driving force for the choice of HR CMS. You need to carefully evaluate the features offered by an HR compliance management system and assess its relevance to the organization.

  3. The ideal HR CMS must be accessible on all devices. The availability of a cloud storage system not only keeps your data protected, but also makes it accessible 24x7 on any device by making use of fewer resources.

  4. A complex HR system with limited user control makes the task of HR compliance management difficult and might defeat the ultimate purpose of HR CMS. Hence, user-friendliness and centralized controls are the features that must not be overlooked while choosing your perfect HR CMS.


An HR compliance management system is software that assists HR Management in performing the required activities by taking into consideration the legislative rules and regulations. The system not only reduces the work burden of management but also increases the accuracy of tasks performed. Moreover, such a system contributes to the overall growth of the employees by the means of performance evaluation systems.

The choice of an HR compliance management system largely depends on the objectives of your firm and the ability of the software to meet these objectives and requirements. All the above-mentioned points must be taken into consideration when you’re planning to incorporate HR compliance management into your business processes.

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