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Social Media November 2020

HUMAN RESOURCES BUDGET

Prepare your HR budget only after you v Selection and Placement
Authored by@Sagar Jivani have clearly understood the business Recruitment advertising, Agency
of your organization and its overall fees, Temporary help, Employee
corporate plan. An HR department referral program, Skills testing,
Every organizational function should have to align HR budget with Drug testing, Background checks,
and activity needs money to strategic organizational goals within Recruitment-related travel, College
run smoothly. Availability of organizational guidelines and procedures. recruitment giveaways, Printing
adequate financial allocation is costs-applications, recruiting
needed for development and HR Budget Defined brochures, Web development /
improvement purposes. This is also true HR Budgeting involves the systematic maintenance, Applicant tracking
of HR. Continuous development and collection of companywide HR system costs etc.
improvement in HR is as important as related information and data so v Training and Development
those in the business activities of your that the finances needed to support External programs, Registration fees,
organization. an organization’s objectives can be Travel expenses, Certification exam
projected. New organizations have no costs, internal programs, Consulting
Managing a human resources prior budget to use for comparison; fees/trainers salary, Program
department involves budget planning therefore, projecting and estimating will materials, Food and beverages
and execution, just like any other be needed for the initial HR budget. supplies for attendees, Audiovisual
company department. Steps to creating rentals etc.
an HR budget include preparing a Methods for HR Budgeting: v Compensation and Benefits
forecast, developing your personnel, Incremental budgeting - using Employee salaries, Payroll costs,
analyzing jobs, and preparing a short the current budget, a new budget is Overtime, Incentive compensation,
and long-term plan to execute your developed by making adjustments Group Medical Claim Policy,
vision. By accurately assessing what upwards or downwards to each item Group Personal Accident Policy,
work needs to be done and who can do based upon expectations. Pension, Provident fund, Gratuity,
it most efficiently, managers can ensure Employees state insurance, Cafeteria
an organization’s success. Zero-based budgeting - every item plan administration, Telecommuting
included in the budget must be justified expenses, Survey reports etc.
Your Human Resource budget must before being included; therefore, the v Employee and Labor Relations
cover all important expenses, whether process begins with a clean slate. Recognition program, Service
present or future, and even for awards, Attitude survey
seemingly insignificant items. Funds Budgeting requires the collection administration, Performance
for HR contingencies are also required. of many forms of data. From a appraisal software, Attendance
Adequate funding is vital to make HR human resource perspective, the incentives, Employment & labour
as a strategic partner. HR Budgeting is a data needed to create a new budget law advisory fees, Outplacement
powerful financial tool that can estimate include the following: expenses, Suggestion program
the expenditures made by the HR awards, Labor relations expenses
department. This strengthens and allows u Number of employees projected for (consultants), Diversity management
the HR to control the cost rather than next year. program administration etc.
letting the cost control the HR initiative. u Benefits cost increases or v Health, Safety and Security
The budget is drawn parallel to the goals projections. Employee assistance program,
of the organization. u Projected turnover rate. Smoking cessation, Fitness facilities,
u Actual costs incurred in the current Safety training / promotion,
HR budgeting is subject to many year. Workplace violence prevention /
factors including corporate policies. u New benefits/programs planned. training, Revenues etc.
The budgeting format may change u Other changes in policy, business v Other
accordingly. You may need to make strategy, law or regulation that may Strategic planning (data/
provisions for other items of HR costs impact costs. consultants), charitable donations,
that may arise from time to time. If you HRIS administration, Intranet
consider any of these important enough While there are many items that may design and maintenance,
in contributing toward improving or may not be included in an HR HR databases/subscriptions/
people’s efficiency and organizational department’s budget, below is a list of memberships/books etc.
effectiveness, include it in the budget. some of the most common ones to consider.

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