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Human Resources Outsourcing: A Three-Way Winning Opportunity

Small businesses are known to outsource various functions of the organization ranging from IT services to payroll functions, legal services and several others. Today, business owners have become familiar with the plethora of benefits of outsourcing offers. They have realized that, contrary to popular belief, outsourcing is cost effective and less time consuming compared to operating those functions within the business. Moreover, outsourcing allows better performance and fewer chances of error.

This is exactly the reason why small businesses have opened their minds, expanded their outsourcing horizons, and are now outsourcing many of the human resource functions too. This is also the reason why there is a good variety of HR consulting firms that let businesses outsource their functions and manage them. With many years of experience, they have the knowledge to deal with complex tasks and manage HR related functions with great perfection.

Business owners have realized that outsourcing not only provides the above-mentioned benefits but also gives a relief from sifting through immense paper work, researching compliance policies, and surfing the web for latest strategies along with processing insurance claims. Also, since HR consulting firms offer to manage an employee’s entire life cycle starting from the hiring process to the termination or dealing with resignation or retirement.

Some of the administrative support tasks HR consulting firms provide include:

  • Hiring Practices
  • Selection Process
  • Employment & HR Compliance
  • New Hire Policies and Handbook
  • Workers’ Compensation Insurance
  • Training & Development
  • ACA Compliance
  • Employee Benefits Policies & Administration
  • Payroll & Tax Administration Training
  • Safety & Risk Management Training

Employers benefit in several ways when they outsourcing human resources practices to HR consulting firms. Here are some of them.

Reduce Overhead and Operating Costs

Since HR consulting firms have years of experience in their field, they have access to the best employees who are experts at their job. Hiring such experts can be very expensive for the firms whereas it can be cost effective to hire an HR consulting firm. Moreover, developing an entire HR department in any organization will require major investment, which be reduced by hiring an HR consulting firm. The concept of economies-of-scale is implemented in HR consulting firms too. When firms outsource their HR activities to consulting firms they benefit from these economies-of-scale too.

Employment Liability Protections

Since HR consulting firms have a great level of expertise over the HR practices, they are in a better position to provide employment liability protection to a business. They know the rules, regulations, and compliances better than others and can ensure that no regulations are compromised while practicing HR activities. They are also better aware of the changing labor laws and are in a better position to comply with them.

Employee Development and Productivity

HR consulting firms are in a better position to train the employees and develop them to perform those functions on their own eventually. They can increase the productivity of the employees through training. And since the employees of the firm can make or break an organization, their training, and development is crucial for success.

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