Most business owners agree that their employees are their most precious assets. As such, managing human resources has become a critical role in the control of a business. Yet for some businesses, the various functions of the HR department are too comprehensive and complex to keep going in-house.
2. Most business owners agree that their employees are their most precious
assets. As such, managing human resources has become a critical role in control
a business. Yet for some businesses, the various functions of the HR department
are too comprehensive and complex to keep going in-house.
Keep in mind, there are several HR strength areas, including payroll, recruiting,
benefits, compliance and more. In some businesses, an HR generalist may be
asked to do more than one of these HR functions, and that can often result in
less than optimal results.
In these situations, a business can achieve the similar level of efficiency and
workforce management by joining a professional employer organization (PEO)
and outsourcing HR. The advantages of outsourcing HR are plentiful and can
have a significant impact on your bottom line.
3. Here are the advantages of outsourcing HR
functions:
1. Cost Savings
Overhead costs associated with fulfil HR services are typically very high.
A fully-functional HR department needs additional office space and
highly trained and experienced HR staff. Many small businesses simply
can’t afford this expense & find that it’s more cost-effective to
outsource HR functions. Outsourcing HR helps decrease your costs &
helps you avoid trying to financially maintain non-revenue - generating
back-office expenses. Furthermore, HR Outsourcing Companies
expense are variable & can be reduced when business needs warrant.
4. 2. Payroll and Accounting
The cost of outsourcing payroll is very less compared to the
cost of maintaining an in-house payroll staff. The outsourced
company can be responsible for employee pay slips, advising
on tax & deduction questions and also offer a payroll analysis
for accounting purposes. This frees up time in calculating the
payroll and dealing with different and sometimes hard
employee situations.
3. Global Talent
One of the great advantages of outsourcing is expanding your
perspectives. When HR functions are outsourced to PEO
companies, you get your HR services done by the best talent
around the globe.
5. 4. Risk Management
Employment and labor laws change regularly, and it can be hard for you to
remain up-to-date on regulations that affect your workplace. Outsourcing
firms employ HR professionals whose purpose is to stay current on federal &
state employment laws. This will help you comply with these laws and avoid
expensive lawsuits brought on by employees. HR firms also maintain and
audit company policies and practices to ensure your business and your
employees’ best interests are protected.
5. Efficiency
Maintaining an efficient and productive workplace is critical. Outsourcing HR
functions creates better efficiency within HR systems. Advanced human
resources technology utilized by outsourcing providers, helps streamline
important HR functions such as payroll, advantage administration &
compliance management. Outsourcing helps you and your managers spend
less time on paperwork and much time dedicated to improving the efficiency
and effectiveness of your workforce.
6. 6. Employee Development
Outsourcing HR functions can help you to manage employee performance and
development. HR providers implement performance management plans to
ensure employees comply with company policies and procedures and
successfully meet your organization goals. Outsourcing firms periodically
monitor employee work and report findings to management. This reduces the
workload of your managers by minimizing their administrative management.
7. Help with compliance
This is one area where many small company really struggle to keep up,
especially with the changing laws pertaining to hiring, insurance claims
management, and benefits regulations. The greatest challenge is that failure to
comply can lead to important financial consequences. Outsourcing HR functions
to a trusted provider can help you understand and take action to comply with
these laws and regulations.
7. 8. Reduce Employment-Related Expenses
While there are hundreds of corporate cost-reducing areas to consider, labor
costs account for one of the largest operating expenses in a business. Beyond
payroll and tax overhead, other costs are related to health insurance premiums,
workers’ compensation insurance, recruiting fees, payroll processing, and legal
costs.
9. Health Insurance Benefits
As our economy improves, employers are looking for ways to incentive &
motivate their staff. PEO firms provide small employers the different
opportunity to offer their staff a robust and comprehensive array of employee
benefits that are typically available to only the largest corporations. These
robust offerings add a wide range of major medical plans and voluntary benefit
offerings.
