Should you consider outsourcing your HR?

For small businesses, HR can be a minefield - a complex area with ever-changing employment law. Have you ever stopped to consider how vulnerable your organisation would be without the support of an effective HR professional if a problem escalated into a crisis? 

Rachel Pook, director at Atoll HR, shares her thoughts on whether you should consider outsourcing your HR and how to choose the right partner for your business.

12 February 2019

Cost saving

If HR and 'people' issues are starting to absorb too much of your time, it might be worth considering whether to employ a HR Manager or to outsource your HR activities. Permanently increasing your headcount can feel like an unnecessary expense - but by outsourcing your HR you can choose to pay a monthly fee or use a pay-as-you-go service (depending on your needs), at a fraction of the cost of an annual salary.

Expert knowledge

It's important that you have access to expert knowledge in key areas such as recruitment, performance, capability, gross misconduct and termination of contract. Having an outsourced specialist HR service will make it easier to keep up-to-date with ever-changing regulations and ensures whatever decisions you make are legally compliant.

Many managers make snap decisions when it comes to people management and getting it wrong is easy. It can also be extremely costly - especially if it results in the employee taking you to an employment tribunal or you having to put in place a compromise agreement.

Commitment

If you outsource your HR to an experienced HR company, you will be using the services and support of people that live and breathe HR. They dedicate all of their time to people issues and are passionate about improving HR processes. They usually have years of experience gained in a wide range of industries and sectors.

Outsourcing will give you the dedicated and totally impartial support that in-house just can’t compete with.

Logic versus emotion

Making decisions that affect your employees can be difficult; sometime facts and logic go out of the window and emotion takes over. But by using an outsourced partner, you can guarantee that the advice and guidance you are given will always be fair and reflective of HR best practice.

Once you've made the decision to outsource, choosing the right HR partner is fundamental. My advice would be to ask yourself the following:

1. Do they care about your business and want to join you on your journey?

2. Are they flexible with their behaviour and approach?

3. Are they a cultural fit with your business?

4. Do you share the same set of values?

5. Would you employ them?

If the answer is “no” to any of these questions, you shouldn’t consider using their services - not even for a short period of time.

Now that you've decided to outsource and you've found the perfect partner, it's time to consider which service will work best for you. If you need the HR company to manage your business on a day-to-day or frequent basis, a monthly retainer or fixed fee package is the most cost effective. Costs will be based on a number of factors, including number of employees, complexities of the task and the time/hours required.

Alternatively, if you just need an outsourced HR company infrequently or on an ad-hoc basis (where your requirement is for a specific task or question), your best bet is to pay by the hour or on an agreed project basis.

By choosing the right partner and a package that is tailored to your exact business needs, you can build a long-lasting and personal partnership that will grow with your business and get the best out of your people.

To get in touch with Rachel, or further information about Atoll, visit her website at www.atollhr.co.uk.