HR Accounting at the Enterprise: How Companies Benefit from Electronic Document Flow Services

HR accounting in companies is a labor-intensive process. In wartime, HR professionals face new challenges: organizing remote work, keeping records of people liable for military service, etc. This article dives into the strategies that companies can employ to streamline HR accounting at the enterprise level, particularly in the context of the current environment.

HR Legislation: What has Changed in Wartime

The Law of Ukraine «On the Organization of Labor Relations under Martial Law» outlines specific requirements for personnel records. Notably, Article 3 contains the following provision:

«During the period of martial law, the parties to an employment contract may agree on alternative ways of creating, sending, and storing employer orders (instructions), notifications, and other documents on labor relations and any other available method of electronic communication, which is chosen by agreement between the employer and the employee».

Recent amendments to Procedure No. 1886/5 further simplify the process, eliminating the need for coordination with state archives for electronic HR documents. This greatly facilitates work with them and expands their use in companies.

Procedure No. 1886/5 also changed the requirements for creating a paper copy of an electronic document. According to the new rules, documents for temporary storage (up to 10 years) may exist exclusively in electronic form: applications, vacation schedules, etc. They no longer need to be duplicated on paper.

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Electronic HR Document Management in Companies

Changes in legislation has paved the way for companies to adopt electronic HR document management with greater ease. The shift is not merely a legal necessity but also a strategic move to enhance efficiency. This is where e-document flow services, such as Vchasno.EDO, come into play, offering solutions to various HR challenges in wartime. Notably, it helps companies solve the following tasks.

Protect documents from loss, theft, or destruction. Since the beginning of the war, many companies have had to evacuate their document archives. And the risk of losing documents remains.

Vchasno.EDO ensures secure storage on servers located in the European Union, mitigating the risk of document loss.

Centralize HR records management. In companies with a branched structure, different departments may keep records of employees using different approaches. This complicates the work of HR managers. A unified approach to HR record keeping is especially important during martial law, as new areas of work are added to the managers’ work (accounting for employees liable for military service, reservations, etc.).

With Vchasno.EDO, the entire HR document flow takes place in a single corporate environment with a clear structure. The manager can customize the access rights of company employees to individual documents.

Simplify personnel records. With the help of a convenient filter system in the Vchasno. EDO service, a manager can find an employee’s file or any other HR document in a few seconds. If a document has several electronic signatures, you can set up signing scenarios and automate this process.

How companies keep HR records with Vchasno

Companies determine which documents to convert to electronic form on their own. As practice shows, companies with a large number of employees most often automate their HR workflow. The need for an electronic HR documents flow also arises when a significant number of employees work remotely.

The experience of Vchasno’s customers

The experience of Vchasno’s customers shows the effectiveness of e-document flow in HR accounting. Notably, EVO, an IT company, implemented an electronic HR document management system even before the outbreak of a full-scale war.

EVO has about 1000 employees. Every month they sign more than 600 documents in Vchasno. We implemented the electronic HR document management system on January 1, 2022. And during the war, when most employees work remotely, electronic HR documents flow has helped us keep processes running smoothly and not delay the signing of documents.

— Olena Oleksienko, HR Director EVO

The company has converted all documents related to hiring, transferring, dismissal, and vacation to electronic form. Only those documents that are large and do not require the signatures of all employees, such as changes to the staffing table, time sheets, etc., are still signed in paper form.

The electronic form of HR documents significantly reduces the time required to process documents and avoids mistakes. In particular, hiring employees — one of the most complex HR processes involving a large number of documents — is faster and easier.

A candidate for a position fills out a questionnaire in which he or she provides the personal data required for paperwork. Based on this data, the HR inspector prepares an order for hiring.

We have created electronic templates for all documents in the accounting system. Therefore, when the inspector creates an order, the system automatically generates a P-2 card, a personal record sheet, an application, and all other documents required for the new employee. The inspector asks the new hire to register with Vchasno and sends them the documents for signature.

— Olena Oleksienko, HR Director EVO

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What is HR accounting?

HR accounting at an enterprise involves the processing, amending, and storage of all documentation related to the company's employees.

What are the HR documents?

Labor legislation defines the following list of HR documents that must be kept at the enterprise:

- staff list;
- Collective bargaining agreement (for legal entities);
- internal labor regulations;
- time sheets;
- orders on personnel issues (regarding personnel);
- order book (order accounting journal). Orders are also registered according to their retention period;
- personal cards of employees in the form of P-2;
- employment record books of employees and a book (journal) of accounting for the movement of employment record books;
- vacation schedule;
- job descriptions of employees.

Other documents (applications, orders, etc.) are used by the company to hire employees, arrange vacations, transfer to another position, dismiss, etc.

Who signs HR documents?

The procedure for approving and signing HR documents is set out in the company’s record-keeping manual.

For example, an employment application is signed by the new employee and the company’s manager. An application for a transfer to another position may additionally be approved by the head of the department in which the employee works, the head of the HR, financial, or legal department. A resignation letter is approved by the head of the department from which the employee is leaving.

What is the HR manager responsible for?

The HR officer is responsible for the company’s HR records, including formalizing employment relationships, maintaining personnel records, and other issues related to the organization of employees’ work.

What is an HR department?

The HR department is a structural unit of the company that is responsible for implementing the HR policy and HR records at the company.

Who keeps personnel records?

As per Ukrainian law, any company, irrespective of size or ownership, is responsible for maintaining HR records. In smaller companies, an HR inspector handles this task, while larger companies delegate it to the HR department.

Who organizes HR records at the company?

The HR department is responsible for organizing HR records, creating personal cards for employees, maintaining employment records, and overseeing the creation and storage of essential documents.

What journals must the HR department have?

According to labor law, the HR department must keep the following journals:

- a book of accounting for the movement of employment records and their inserts;
- a logbook of orders on personnel matters with a long (75 years) retention period;
- a journal of registration of orders on personnel matters of temporary (5 years) storage period;
- a logbook of personal files;
- logbook of employees’ employment;
- register of underage employees.

Who approves the transition to electronic HR document management in the company?

Usually, the HR director or HR inspector approves the transition to e-document workflow. They coordinate it with the company’s director, and heads of legal, finance, and IT departments.