When You Should Get Outsourced HR Services

ByContent Manager
Outsourced human resources

Human resource functions are vital to all businesses of any size. And as many companies re-evaluate the way they operate, they are also considering whether to keep HR functions in-house or outsource them. The reality is that for many businesses, outsourcing these functions makes sense. It can be cost-effective and frees up personnel for other business tasks. Additionally, many companies can achieve better compliance by working with outsourced professionals who know all the laws and regulations that affect your company.

Additionally, many HR companies can handle dealing with sensitive employee data, which is a common concern for businesses considering outsourcing. Many HR functions can be easily completed by outsourced companies, such as:

  • Payroll and related tax services
  • Administrative HR functions (creating employee handbooks, implementing HR policies, terminating employees
  • HR risk and legal compliance
  • Recruiting and onboarding employees
  • Employee training and development
  • Benefits administration
  • Employment law compliance
  • Employee assistance programs (EAP) and counseling

And these examples are just a few of the services that can be outsourced. And while outsourcing may not be the ideal solution for all companies, it can benefit many. A few conditions that often indicate outsourcing HR services can be beneficial include:

Indicators That Your Business Should Consider Outsourcing HR

  • You spend too much time handling HR problems. Business owners have to juggle many tasks simultaneously. But it’s important to recognize that focusing on HR problems can be incredibly time-consuming, which takes you away from growing your business and developing new products or services. Outsourcing HR in these circumstances can allow you to focus on your real talents as a business owner and ensure that your HR problems are still dealt with competently.
  • You don’t feel your current HR policies and processes are adequate. Not having the right policies and procedures can be a huge liability for any company. HR teams should demonstrate a strong understanding of hiring rules, Equal Employment Opportunity Commission requirements, collective bargaining agreements, and recruiting and training. Additionally, they must understand industry-specific regulations and complex payroll and tax laws. Unfortunately, most business owners don’t have this knowledge without putting a lot of effort into learning. Outsourced human resources reduce your liability by ensuring that you have appropriate policies and procedures.
  • You are looking to cut expenses. Many businesses are feeling more financial pressure than ever before and are analyzing their budgets for any cost-cutting measures they can find. Outsourcing allows you to complete all required HR functions while also saving money. And if you can focus on revenue-generating activities rather than HR functions, you may also be able to grow profits while saving money.
  • Your business’s HR roles are unclear. Some HR functions may be assigned to managers and other leaders, but this can make the lines of accountability unclear. You can ensure that your business leaders focus on their other tasks rather than HR with outsourced human resources.
  • You can pivot quickly. One of the hallmarks of modern commerce is the tremendous amount of change that can occur quickly. For instance, the recent pandemic reshaped how many companies conduct business in a matter of a few months. And while change isn’t always this dramatic, it is constant. Outsourced human resources ensure that your business has the resources to grow and respond to any market, industry, regulatory, and competitive changes.

While these signs are often a good indicator that your business should consider outsourcing human resources, there are many other circumstances where outsourcing can be a great business move. Outsourcing HR provides many business benefits, such as:

Benefits of Outsourced HR Services

  • An improved hiring process: Outsourcing HR functions like recruiting, conducting background checks, and onboarding can streamline your hiring process and reduce the time it takes to hire and train individuals.
  • Enhanced compliance: When outsourcing to experts, you can have peace of mind that your policies and procedures will be legally compliant. Additionally, you can be sure that any regulatory changes will be adopted by your company quickly, which can reduce your overall risk.
  • Reduced costs: The biggest reason outsourced human resources have grown so quickly is that it often provides company cost savings and can even help your business avoid non-compliance penalties and fines.
  • Reduced turnover and happier employees: With outsourced HR functions, employees often have more responsiveness when they encounter issues, enhancing overall job satisfaction. Additionally, these companies can handle employer/employee relations and mediate more effectively to reduce turnover.

Outsourcing HR can make sense for many companies. Contact CA HR Services today to learn more about the benefits of outsourcing HR functions and whether it makes sense for your business.

CA HR Services specializes in working with small and medium-sized companies to help develop legal, efficient, and appropriate H.R. processes and procedures that meet state and federal labor law requirements.