Outsourced HR is when employers choose to use an external company to look after their HR function or part of it. Much like when businesses outsource IT or marketing services. Traditionally, big businesses tend to have in house HR people, but it is thought that around one-third of small and medium-sized companies now use outsourced HR support.
What Can Small Businesses Outsource?
Outsourced HR is usually provided by HR consultancy practices or freelance HR consultants. Services available to small businesses are usually mediation services, advisory services, or support package deals for outsourcing HR.
Outsourced HR packages are generally available for a monthly fee and will relieve you of much your HR administration such as updating contracts and handbooks. Packages for small businesses usually include unlimited HR advice – one of the most valuable aspects of the service as many small business owners would not have access to professional HR advice within their own business.
Outsourcing is as simple as finding an HR consultancy that offers a package or services you find attractive and that fits with what you want to outsource – whether that is some or all of your HR function.
When Is The Right Time To Outsource HR?
Many small businesses may not outsource HR services – often relying on a team member, such as an office manager or someone in finance to ‘look after HR’. However, these businesses not only leave themselves vulnerable to legal proceedings if HR procedures haven’t been followed correctly but having to look after HR on top of days jobs can become extremely stressful for staff.
There is no perfect time to outsource HR but if your business has people looking after HR that aren’t HR people – outsourcing is something that should be investigated.
What Are The Benefits?
When it comes to HR there are two options – recruit a permanent HR professional to work in-house or outsource your HR. Or in some cases, businesses have a blend of the two and only outsource certain highly specialised functions. Such as disciplinaries, Mediation, grievances or hearing appeals.
For a small business, particularly those with less than 50 staff, recruiting an HR professional just isn’t feasible and it’s more common to find small businesses outsourcing their HR.
As mentioned, small businesses are likely to have staff members who double up to deal with HR duties – outsourcing can relieve these people of those duties, freeing them from additional stresses and giving them the time back to focus on their roles.
For the business, outsourcing HR has multiple benefits.
Firstly, outsourcing HR is more cost-effective than hiring a person. HR professionals in the UK earn around £36,710 per annum, on average. For many smaller businesses, they simply can’t afford to recruit qualified, professional staff.
Outsourcing gives you access to the same high level, talented professionals at a fraction of the cost.
The access to talent is another benefit – when you outsource you gain immediate access to a wealth of knowledge, the latest professional practices and of course, the most up to date understanding of employment law.
The legal element is also a strong motivator for outsourcing – your outsourced HR team or advisor will work on your behalf to ensure you are compliant and have the knowledge to protect yourself professionally.
Click here for more reasons to outsource your HR, including why you should choose Metis HR.
Contact Metis HR
If you have any questions about outsourcing HR for your small business, including costs, please contact us on 01706 565 332 or send an email to firstname.lastname@example.org