Outsourcing HR has become a popular business strategy and a valuable tool for businesses of all sizes, says Greg Guilford at HR Solutions. Organisations that don't have resources for a full-time or in-house HR department still may require expert advice and support. Outsourcing can help them through the ever-changing obstacles of UK legislation, as well as providing support with employment law, HR issues.
What can I outsource?
There are many options when considering outsourcing your HR requirements. These will greatly depend on the size of your business and whether you wish to keep some of the HR function in-house. Organisations will often choose to outsource:
- HR administration
- HR documentation and procedures
- Recruitment campaign management
- Advice and guidance
- Redundancy and restructure process management
- Training and development
- Grievance and disciplinary investigations
For many businesses, the functions of the HR department are often too wide-ranging and complicated for in-house. This is why many businesses choose to outsource their HR and because of the many ways it helps support a business’s bottom line.
- Risk management: Employment laws can change regularly. It can often be difficult for many employers to stay up-to-date with regulations that affect the workplace and their employees. HR service providers have the expertise to enable businesses to always comply.
- Cost savings: A fully functional, in-house HR department requires office space and experienced HR staff, making outsourcing much more cost-effective.
- Efficiency: Outsourcing frees up employers to focus on improving the effectiveness and efficiency of the workforce.
- Employee development: HR can implement performance management plans and training programmes to ensure employees comply with company policies and procedures.
Once you've decided to outsource your HR, ensure you select an accredited HR service partner which offers expertise and in-depth knowledge of your sector. To make sure you select the right HR provider, consider the following:
- Contract length: You have no way of knowing what your requirements will be in the long term. Choose a contract of no longer than a year and include flexible terms that reflect your use of the service (which may change as your business develops).
- Face-to-face meetings: You should be able to arrange a face-to-face meeting whenever you wish. It’s the most effective way for your HR provider to gain a full understanding of your company, your needs or any specific issue.
- HR support package: Some providers only provide basic HR advice. If you are outsourcing HR to save yourself time, this doesn’t help you at all. Make sure you understand what the package does and doesn't include and which services incur extra costs.
- Link to payroll: Some HR providers offer payroll services. However, if they don’t, you need to ask how they will work with your payroll. You should also check how they base their prices.
- Employee data storage: It’s your responsibility to ensure the correct handling and storage of all personal employee data. Ask the HR provider how and where they store physical and electronic files. They should also tell you how they destroy personal and sensitive personal data in line with Data Protection guidelines.
- HR system: Ask for details about the HR system they use and whether they offer web based HR systems.