Audit of Staffing and Recruitment

1.0 Executive Summary

1.1 Introduction

Whereas the primary accountability for human resources (HR) rests with all members of Industry Canada management, the Human Resources Branch (HRB) provides strategic information and advice to the department. The Branch consists of the Director General's HR Directorate and six service-oriented directorates: Strategic Human Resources Management, Operations and Programs, Administrative Services, Executive (EX) Group Services and Developmental Programs, Labour Relations and Compensation, and Conflict Prevention and Early Resolution.

HRB also provides technical expertise to the department's regional offices, which are responsible and accountable for the delivery of HR activities and services within their respective offices. Although HRB does not hold authority over the regional offices, it does provide them with technical expertise as per a Memorandum of Understanding.

This audit was conducted in accordance with the Audit and Evaluation Branch's 2009–2010 Risk-Based Audit Plan based on a department-wide preliminary survey of HR functions conducted in 2009. In addition, the Public Service Commission notified Industry Canada (IC) that the department would be subject to an audit of staffing in 2012. In early 2010, a review of Human Resource Management risk areas in IC resulted in this audit being reprioritized to the 2009–2010 Risk-Based Audit Plan.

The objective of this audit is to assess the level of compliance, efficiency and effectiveness of staffing and recruitment processes and practices to help ensure that the person appointed is the right fit for the job so that the business and human resource needs of the department are met.

The scope of the audit covered fiscal years 2008–2009 and 2009–2010 and focused on the following areas of staffing and recruitment:

• Governance
• HR Planning
• Monitoring and reporting
• Staffing tools and HR advice
• Training
• Staffing values — Public Service Employment Act (PSEA)
• Information

1.2 Audit results

Governance: Strengths include: a subdelegation instrument that is well controlled by HRB and operates as expected; and an integrated planning process, consistent with the Public Service Employment Act (PSEA), that considers both current and future needs of the organization. In addition, all appointments in the audit sample were appropriately signed by subdelegated managers with required training. Areas for improvement include:

1. Most Industry Canada sector HR plans did not document progress or how staffing processes selected aligned with plans.
2. HR advisors are not sufficiently involved with subdelegated managers in sector HR planning.
3. Expectations of HR advisors and subdelegated managers differ.
4. Staffing activities are not always conducted by individuals who have completed the required training on staffing.

Internal Controls: Strengths include: documented staffing advice provided by HRB that is consistent with Public Service Commission (PSC) and IC policies; subdelegated managers having access to timely and relevant information, from multiple sources, on staffing and recruitment; proactive steps taken by HRB to improve the reliability of information stored in the PeopleSoft Human Resources Management System, and used for reporting to PSC; and consideration of overall PSC and IC priority requirements. Areas for improvement include:

5. Over half of the written rationales for selecting a non-advertised process in the audit sample did not provide sufficient evidence of consideration of the guiding values.
6. Assessment tools and methods insufficiently or incompletely assessed essential qualifications and other identified merit criteria.
7. Over half of the staffing files in the audit sample did not contain sufficient key information on academic credentials and evidence of an HR challenge function.

Risk Management: Strengths include: evidence of monitoring was found in staffing files and is reported; and IC has recently updated its monitoring practices to mitigate risks and to determine whether appointment processes are in accordance with legislative requirements. Looking forward:

8. The updated staffing monitoring system needs to be sustained.

1.3 Conclusion

Overall, Industry Canada's staffing and recruitment processes and practices are performed with efficiency and effectiveness. However, improvements in certain areas would help ensure greater compliance with governing legislation and policies in appointing persons with the right fit for the job to meet the business and human resource needs of the department.

1.4 Recommendations

It is recommended that:

1. The Director General (DG) of HRB should monitor progress on sector HR plans to support the reporting of variances between HR plans and actual staffing activities, as required by IC and the Public Service Commission.
2. The DG of HRB should ensure that the integrated planning process involves HR professionals who are responsible to support the sectors in implementing staffing strategies.
3. The DG of HRB should ensure that roles, responsibilities and accountabilities of HR advisors and subdelegated managers are clearly defined throughout the staffing process for non-EX appointments.
4. The DG of HRB should ensure that all employees involved in staffing and recruitment processes have access to and pursue adequate training to demonstrate knowledge of staffing requirements.
5. The DG of HRB should ensure that subdelegated managers demonstrate how the use of a non-advertised appointment process meets the department's established criteria and the appointment values.
6. The DG of HRB should review the appointments in the audit sample where there were deficiencies in the assessment of candidates and ensure that assessment tools and methods fully and fairly assess essential qualifications and other identified merit criteria.
7. The DG of HRB should ensure that appointments and appointment-related decisions, as well as advice provided to subdelegated managers at key decision points (i.e. link of staffing action to HR plan, choice of appointment process, assessment), are fully documented.
8. The DG of HRB should ensure that the Staffing Policy and Monitoring Section monitoring system now in place is fully implemented and sustained.

1.5 Statement of Assurance

In my professional judgment as Chief Audit Executive, sufficient and appropriate audit procedures have been conducted and evidence gathered to support the accuracy of the opinion provided and contained in this report. The opinion is based on a comparison of the conditions, as they existed at the time, against pre-established audit criteria that were agreed on with management. The opinion is applicable only to the entities examined and within the scope described herein. This audit was conducted in accordance with the Internal Auditing Standards for the Government of Canada.

1.6 Audit Opinion

In my opinion, the Audit of Staffing and Recruitment revealed there are risk exposures related to internal controls and governance relative to staffing and recruitment that require management attention.