Traditionally, human resource management (HRM) was focused on personnel management through policies and practices (Ulrich, Brockbank, Johnson, Sandholtz, & Younger, 2008) and was seen as a highly administrative function. However, in today’s competitive global business market, there has been increasing interest and importance placed on how HRM contributes to organisational performance and delivering business results (Boselie & Paauwe, 2005; & Ulrich et al., 2008). The hotel industry is becoming of increasing value to both the New Zealand and the Australian economy. Effectiveness of the Human Resource (HR) function is particularly important in the hospitality industry as service industries place much importance on employees as the main source of competitive advantage (Browning, Edgar, Gray, & Garrett, 2009). The hotel industry is characterised as highly labour-intensive, with high turnover, therefore effective HRM plays a vital role in this sector (Davidson, McPhail, & Barry, 2011; Lockyer, 2007; Lucas & Deery, 2004). For these reasons, the hospitality industry is theoretically and practically interesting and valuable in providing insight into the perceptions of HR competencies and effectiveness. One way that HRM integrates people management and business strategy, connecting people with business, is through HR business partner and competency models (Losey, 1999; Ulrich, 1997; Ulrich & Brockbank, 2005; Ulrich, Brockbank, Yeung & Lake 1995). Over the past decade, these models have become increasing prevalent and popular (Burgoyne, 1993; Yeung, Woolcock, & Sullivan, 1996). The critical dimensions of these models is the competencies required of HR professionals who work and run the function (Ulrich et al., 2008). In this regard, six well-established HR competencies have been identified by Ulrich et al. (2008), which are: credible activist, operational executor, business ally, talent manager/organisation designer, culture and change steward and strategy architect. The competency model proposes that these principal competencies are predictors of HR effectiveness. Exploratory Factor Analysis (EFA), correlations coefficient and multiple regression analysis were performed to test the research hypotheses. An online questionnaire was used to conduct the research study. Data were collected from 103 participants that were hotel industry employees working in hotels across New Zealand and Australia. Participants held a range of job functions and worked across a variety of departments. The results of this study showed that the HR competencies that were the strongest predictors of HR effectiveness were a combination of Credible Activist and Talent Manager/Organisation Designer competencies as well Operational Executor and Talent Manager/Organisation Designer. The study examines two critical lines of inquiry, being, how employees perceive the six HR competencies in the HR function and, secondly, how these perceptions impact on effectiveness. Therefore, the study contributes to the body of knowledge on HR competencies and HR effectiveness. The study also contributes to a gap in current literature about HR competencies and HR effectiveness in the New Zealand and Australian hotel industry context. Theoretically, the empirical findings of the study contribute to the ongoing discussion regarding the validity of HR competency and the business partner models. Practically, the findings indicate which competencies are perceived to be the best predictors of HR effectiveness that provides guidance for HR professionals in the hotel industry across New Zealand and Australia.