Providing HR support and advice to SME across the UK since 2006
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Providing HR support and advice to SME across the UK since 2006
Employment law is changing faster than at any point in a generation. Our structured HR audit gives you a clear, prioritised compliance roadmap so you know exactly where your business stands and what to do next.
Providing HR support to SMEs across the UK since 2006 · No retainers · No placement fees
Employment law in the UK is changing faster than at any point in a generation. The Employment Rights Act 2025 is already reshaping the landscape, with further changes rolling out through 2026 and into 2027. Knowing whether your current practices, policies and documentation are keeping pace is a different matter entirely – and this is where an HR audit becomes not just useful, but essential.
days' pay - the new maximum protective award for collective redundancy failures (doubled from 90 days)
Statutory sick pay and paternity leave became day-one rights from April 2026
Unfair dismissal compensation caps removed - the financial exposure for employers increases substantially
An HR audit is a comprehensive review of your HR practices, policies, documentation and processes, assessed against current employment law and best practice standards. At HRCentral, we carry out our audits on-site, working with your management team to examine how your HR function actually operates – not just how it looks on paper.
A thorough audit will cover your contracts of employment and whether they are legally compliant and up to date; your employee handbook and standalone policies; your approach to performance management, appraisals and absence; your health and safety documentation; personnel file management and data protection compliance; and the way your managers recruit, manage and develop their people.
Not sure where to start?
Our initial conversation is free and no-obligation. We’ll ask about the size and structure of your workforce, the areas you’re most concerned about, and what’s prompted you to think about an audit now. From there, we’ll provide a clear proposal and indicative timescales.
The Employment Rights Act 2025 represents the most significant overhaul of UK employment legislation in decades. Changes are being introduced in a staggered sequence, and many employers are simply unaware of what has already come into force and what is still to come.
| Key legislative changes - what's already in force and what's coming | |
|---|---|
| April 2026 |
Day-one rights introduced Statutory sick pay and paternity leave became day-one rights, with no qualifying period. Employees qualify from the very first day of employment. |
| Now |
Sexual harassment duty strengthened Employers must now demonstrate they have taken all reasonable steps to prevent sexual harassment - a higher bar than previously applied. |
| Now |
Collective redundancy award doubled The maximum protective award for failures to consult in collective redundancy situations has doubled from 90 to 180 days' pay. |
| January 2027 |
Fire and rehire restrictions Fire and rehire practices will in most cases become automatically unfair. The qualifying period for unfair dismissal claims reduces to six months. |
| January 2027 |
Compensation cap removed The compensation cap on unfair dismissal awards is removed - the financial exposure for businesses who get things wrong increases substantially. |
The bottom line: If your contracts, policies and processes have not been reviewed recently, you may already be non-compliant. The time to find out is before something goes wrong, not after.
The risks are both legal and reputational. From an employment tribunal perspective, outdated contracts, inconsistently applied policies and inadequate documentation can leave businesses exposed to claims they might otherwise have avoided. With unfair dismissal compensation caps set to be removed in 2027, the financial consequences of a poorly managed dismissal or disciplinary process are likely to be far higher than they have been historically.
Beyond tribunals, non-compliance with data protection obligations under UK GDPR can carry significant regulatory consequences. Failing to hold correct right to work evidence, or allowing personnel records to fall into disarray, can cause real operational and legal difficulties – particularly if an employee challenge or regulatory audit occurs.
There are also the quieter, less visible costs: low morale caused by inconsistent management, poor retention linked to unclear expectations, and the time senior leaders spend firefighting people issues that a more robust HR framework would have prevented. As a business owner, you perhaps do not know what you do not know. An audit changes that.
Our CIPD-qualified team has been helping UK businesses understand and address their HR risks for nearly two decades. Speak to us today about arranging an audit.
One area where an HR audit is particularly valuable – and often overlooked – is in the context of corporate transactions: acquisitions, mergers, management buyouts or business sales. Buyers and investors conducting due diligence will scrutinise your HR documentation, employment contracts, policies, ongoing employee relations issues and any historic tribunal activity. Gaps or non-compliance discovered at that stage can affect deal valuation, delay completion, or in some cases, become a dealbreaker entirely.
Carrying out an HR audit in advance of a sale or transaction gives business owners and their advisers the opportunity to identify and resolve issues before they become negotiating points. It demonstrates that the business is well-managed, that its employment practices are sound, and that there are no hidden people-related liabilities waiting to surface.
Planning a business sale or corporate transaction?
Our HR audit services can form an important part of your preparation and due diligence process. We work with business owners, management teams and their advisers to ensure HR documentation is in order well before it comes under scrutiny.
Our process is straightforward and designed to be as non-disruptive as possible. We begin by reviewing your existing HR documentation – employment contracts, your handbook and standalone policies, and any supporting templates or procedures. We assess your health and safety documentation against your legal obligations as an employer. We conduct a structured review of your personnel files, assessing completeness, consistency and data protection compliance.
As part of the audit, we meet one-to-one with key managers and senior leaders. These conversations are some of the most valuable parts of the process. They give us a real picture of how HR policies and processes are experienced in practice, whether there are inconsistencies in how things are applied, and where the pressure points are. It is in these conversations that the gap between policy and practice often becomes visible.
At the end of the audit, you receive a detailed written report using a Red, Amber, Green rating system.
Red - Urgent
Areas of concern or non-compliance requiring urgent attention. Each Red finding is accompanied by practical, prioritised recommendations.
Amber - Action Required
Areas to be reviewed and improved in the near future. You will know exactly what needs to happen and in what order.
Green - Compliant
Confirmation of what is working well. It’s important to know what your strengths are, not just the gaps.
We then present and discuss the findings with you and any relevant stakeholders, either in person or via video call, answer your questions, and agree on next steps. If you need us to help implement the recommended changes – whether that is updating contracts, rewriting policies or supporting your managers through new processes – we are there for that too.
“Our clients tell us that the audit report is the most useful HR document that HRCentral have produced for their business. It gives them a clear roadmap, with no ambiguity about what needs to be completed with HRCentral’s expert assistance, at our usual hourly rates.”
Our structured audit form covers every area of your HR function. Here is an overview of the key areas examined:
1
Contracts & Benefits
Are contracts legally compliant and up to date? Holiday entitlement, sick pay, pension arrangements, enhanced family leave provisions, and whether benefits are correctly documented and consistently applied across your workforce.
2
Policies & Handbook
Review of all legally required policies (disciplinary, grievance, health & safety, data protection, equal opportunities) and recommended best practice policies including flexible working, absence management, and IT use.
3
Onboarding, Induction & Probation
Pre-employment checks, right to work verification, DBS requirements, induction programmes, and whether probation processes are consistently applied and documented in line with the recent employment law changes to ensure compliance.
4
HR Administration & Records
Personnel file management, GDPR compliance, HR Information System systems, training records, holiday recording, disciplinary and absence records, and payroll administration processes.
5
Performance, Appraisals & Reward
How staff are appraised, whether objectives are SMART, salary structures and grading, equal pay considerations, bonus documentation, and how appraisal outputs are used in practice.
6
Employee Relations & Management Culture
History of employment tribunals, current disciplinary and grievance situations, communication structures, management responsibilities, employee survey outcomes, and workforce statistics.
Also Covered
Business Strategy, Culture & Succession
Business objectives, current and anticipated HR challenges, culture and values, succession planning, and the top three changes that would make the biggest difference to your organisation in the next six to twelve months.
Absolutely not. In fact, some of the greatest value we deliver is to growing businesses – typically those in the 10 to 100 employee range – who have reached a size where informal HR approaches are no longer adequate but who have not yet built an internal HR function. At this stage, contracts may not have been updated since they were first drafted. Policies may exist on paper but not in practice. Managers may be making decisions based on instinct rather than process and legislation.
For these businesses, an audit is often genuinely eye-opening. It identifies what is working, flags what needs attention, and provides a clear, practical plan for getting HR on a sound footing. The cost of getting this right proactively is almost always lower than the cost of dealing with the consequences of getting it wrong.
Not sure if an audit is right for your business? Our initial conversation is free, no-obligation, and focused entirely on understanding your situation.
Getting started is straightforward. We begin with a free, no-obligation conversation focused entirely on understanding your business and your needs. We’ll ask about the size and structure of your workforce, the areas you’re most concerned about, and what has prompted you to think about an audit now. From there, we’ll provide a clear proposal and indicative timescales.
With the Employment Rights Act 2025 bringing the most significant changes to employment law in a generation, and further changes continuing to roll out through 2026 and 2027, there has never been a more important moment to make sure your business is on solid ground.
Book an HR audit
Our on-site HR audit is conducted by CIPD-qualified HR professionals and can be tailored to your organisation, sector and specific areas of concern.
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About HRCentral
We’ve been supporting SMEs across the UK with pragmatic, no-nonsense HR advice since 2006. No retainers. No placement fees. Just expert support when you need it.
Our CIPD-qualified team has been helping UK businesses understand and address their HR risks for nearly two decades. Speak to us today about arranging an audit.