What is the HR department for?
The Human Resources department deals with your most important resource: your people. This encompasses all your employees and potentially any workers, contractors or volunteers. With such a wide scope it helps to narrow this down and look at the essentials of what HR should be doing for your business.
Are you covering these essentials?
The HR department is responsible for managing an employee life cycle.
This starts with recruiting, hiring and onboarding new employees; training; dealing with their individual issues and needs; administrating payment and benefits; and ultimately offboarding them.
These are the operational responsibilities, but HR is more than that. It is also providing the function to ensure employees not only work but thrive in their roles and as part of the organisation. Employee wellbeing is of significant importance in ensuring you get the best from people.
What an outsourced HR department can add
- Skills and knowledge
With outsourced HR you are not reliant on the skills and experience of one or two people. Instead, you have access to a bank of knowledge through the outsourced HRs network of employees and consultants. You have access to specialist knowledge. Any effective outsourced HR company will have specialists in their field – from payroll to wellbeing, employment law or compliance to name a few.
Once again specialist knowledge comes to the forefront. Legislative changes are continuous and without an individual in your organisation to track all these and see the implications for your business you risk falling foul of changes. Outsourced HR make it their business to know of these changes and inform clients before they happen.
You are experts in what you do. As a business, the focus should be on what you do and by outsourcing your human resource department you will be able to focus on doing what you do as a business.
- Reduced Costs
Ignoring the need for someone with a detailed understanding of HR within the business can be costly. The cost of poor people management can be high and if the law is breached the business could end up with a costly claim at an employment tribunal and/or legal costs.
The cost of management time alone for dealing with HR issues, for example, a troublesome employee, are usually wholly disproportionate. Having the resource to deal with this externally, or to use the expertise to stop issues escalating, saves both time and money.
Are there any downsides to outsourced HR?
There can be a perception that outsourced HR is impersonal and physically distant. This however doesn’t necessarily have to be the case. Many outsourced HR models will give you a main point of contact. This consultant will effectively act as ‘your’ HR adviser. They can often have a visible presence on site and become a trusted adviser for both the management team and also for employees seeking assistance or support.
If you make the decision to choose to outsource your HR department, ensure that you are not just achieving the benefits detailed above, but that the provider doesn’t come with any associated downsides and offers a personal service to you.