Internal Equity as HR Role

The role of Human Resources is in setting the internal environment, which allows the smooth and rapid growth of the organization. The HR Role is in setting the basic rules for HR processes and procedures as the internal equity is reached. The organization without the internal equity loses its competitive advantage.

Employees and managers are focused on internal inadequacies, and they do not work on making processes, products and services more efficient. The internal equity is crucial for employees as they focus on their development. The fair conditions for all bring the healthy competition among employees and managers. The role of HR is in building the environment with the same conditions and prerequisites for everyone.

It is difficult for managers and employees to work in the environment without the internal equity. Managers do not focus on building the competitive advantage. They focus on receiving the benefits at the expense of other managers in the organization. The cooperation in the organization is difficult, and employees do not want to apply for internal job vacancies (as they can lose some benefits).

The role of HR is being the fair Business Partner. The fair business partner does not accept every idea of the management. The fair business partner defines the basic rules and procedures and sticks to them.

The HR Role is in (as the internal equity is reached):

  • Designing, developing and maintaining the job description policy. It can be seen as the administrative tool, but the job description is a basic HR tool for the management of skills and competencies in the organization. The job descriptions have to be public, and employees have to have a quick access to all job descriptions.
  • Defining the workforce management policy. The workforce management policy brings the comparable workloads to teams. It can destroy motivation if employees feel differences in the workload. There are always units with a lower or a higher workload, but the workforce policy should help to identify them (and action on them then).
  • Setting the compensation policy. The compensation policy is the key HR policy. It sets the rules for the remuneration of employees and managers. It sets the desired level of compensation, and it sets the rules for the salary review, bonus calculation and extra bonuses. The employees have to see the fair approach to them.
  • Designing the performance management and goal setting process. The performance management process identifies the top performers and high potential employees in the organization. HR Role is in setting the criteria for setting goals and the performance evaluation at the end of the year. The performance management has to incorporate the performance calibration as employees feel the same chance to become the top performer.
  • Designing the appeal and grievance process. The organization has to design processes to identify potential internal risks. The employees are one of the best sources of doubts and ideas to investigate. Employees should feel free to appeal for the behavior not aligned with the corporate culture. HR has to act as the employee advocate and has to investigate all appeals and grievances.

The internal equity is one of the greatest values for Human Resources. The role of HR is setting the environment, which protects the internal equity. The value of the internal equity is high for Human Resources. The main HR decision should be driven and centered around the internal equity. The role of HR is in increasing the internal equity in the organization (as no organization is perfect in this area).