HR stands for Human Resource. From the perspective of an organization, the ‘Human Resource’ refers to its employees. While machine, material and money are inanimate, human resource alone lives. It is the only resource that can think, act, be emotional, be motivated to work better and can also become unpredictable. The Human Resource in every organization should be ensured about their participation in management, Quality of Work Life, job satisfaction, grievance redressal, conflict resolution and their freedom to form associations and collectively bargain for their rights. Law regulates the Human Resource in an organization by various labor welfare and social security legislations. A person who stands at the intersection of these two professions is much awaited for in the corporate world. This submission discusses about the scope of Human Resource in Law.
Human Resource Management (HRM):
“HRM is that part of the management process which is primarily concerned with the human constituents of an organization” said EFL Brech. HRM is pervasive, on-going in nature, dynamic and interdisciplinary. It helps the organization to identify its manpower needs, ensures that the organization does not suffer from surplus or deficit and facilitates the selection of the right man for the right job. It emphasizes on the need for good human relations in every workplace.
From salary to employee rules and regulations to the compensations and leaves policy, all the aspects that create an atmosphere of discipline in the organization are taken care of by the HR department. Whether it is small scale industry or a multinational, human resource acts as a backbone to keep the organization upright 24*7.
In India, there are various levels of qualification in HR ranging from diploma to doctoral level.[i] A person with a specialized MBA (HR) degree is considered as a HRM Professional or a HR Manager. The key skills required out of a HR professional include –
1. People person
2. Communication skills
3. Listening skills
7. Easily approachable
8. Emotionally Strong
The job role of a HR Manager includes screening and recruitment of laborers, orienting them to the work culture, conducting performance assessment, resolving their concerns and grievances, building relationships, reviewing salary and ensuring legal compliance.
How can a person with legal knowledge be a better HR Manager?
Based on the job role, there are some areas where a HR Manager with legal background will have an edge over a HR Manager with non-legal background. The following are some of the areas:
Labor Law Advise to the Organization:
The following are some of the labor legislations that every organization should be aware of –
1. Employees Provident Funds and Miscellaneous Provisions Act, 1952;
2. Employees’ State Insurance Act, 1948;
3. Factories Act, 1948;
4. Industrial Disputes Act, 1947;
5. Minimum Wages Act, 1948;
6. Payment of Bonus Act, 1965;
7. Payment of Gratuity Act, 1972;
8. Trade Unions Act, 1926;
9. Employees’ Compensation Act, 1923;
10. Child Labor (Prohibition and Regulation) Act,1986;
11. Contract Labor (Regulation and Abolition) Act, 1970;
12. Industrial Employment (Standing Orders) Act, 1946;
13. Maternity Benefit Act, 1961 etc.
Ranging from the applicability of the Act for the organization, to ensuring the filing of returns in the prescribed forms, maintaining relevant registers etc. the HR Manager with legal background will be able to appreciate the complexities involved and can ensure better compliance. He/she will also be in a better position to advise the top management when it comes to taking policy decisions that might impact the compliance with these labor laws.
Be proactive in employment litigation:
A major field of law that is gaining prominence these days is employment litigation. A HR manager with legal backup will be able to understand the nuances of the labor laws and can ensure better response to legal notices, can draft better claim documents and can be of aid to the organization in drawing up the litigation strategy.
Have a better understanding of corporate legislations and their implication on the workforce:
ESOP (Employee Stock Option Plan), ESPS (Employee Stock Purchase Scheme), Sweat Equity Shares etc. are issued to the employees in different cases. Mergers and Acquisitions involve transfer of employees. A HR Manager with a legal background will be able to handle the situations involving such issue of shares or mergers with more ease and comfort than a non-legal HR Manager.
Ensure Just and Fair Grievance Redressal:
Grievance is any dissatisfaction or feeling of injustice in connection with one’s employment situations that is brought to the notice of the management. There may be several grievance issues ranging from sexual harassment at workplace to inadequate amenities. The fundamental principle that any student of law is taught is the ‘Principle of Natural Justice’. Procedural fairness is implied even in situations where the statute does not provide for.[ii] A HR Manager with legal background will be able to ensure that a free and fair hearing is conducted by the internal committee and that the principles of natural justice such as audi alteram partem (Hear the other side) and nemo debet esse judex in propria causa (No man should be a judge for his own cause) are followed.
Conduct effective HR Audit:
A HR audit typically encompasses appraisal of the compliance with applicable labor, taxation and corporate laws relating to hiring/ firing of employees, terms of employment, employee compensation, stock option plans etc. It also includes review of the policy and procedure of the company with respect to such issues as non-disclosure and non-competition. The HR Manager with legal background will be able to conduct this audit with more efficiency and accuracy and can ensure better re-engineering of the company’s policies.
Apart from the above-mentioned advantages, a HR Manager with a legal background can also ensure that trade union activities are within the legal framework, employees are given their right to collective bargaining, employees are made a part of the decision making process by implementing participative management techniques, employees have a better quality of life in the form or adequate and fair compensation, safe and healthy working conditions, opportunity to develop human capacities and better career prospects.
An additional qualification in Human Resource Management along with law is an add-on in the corporate world. A HR manager with legal background can be a person who liaisons better between the employee and the top management than the other non-legal HR managers. Since it is highly lucrative, it is much sought after. However, it is important to consider the individual’s personal preferences, ability to bear costs, invest time etc. before taking such a career decision.
Edited by Pragash Boopal
Approved & Published – Sakshi Raje
[ii] Maneka Gandhi v. Union of India, (1978) 1 SCC 248.