Our Recruitment Top Priorities for 2024
November 16, 2023
What is human resource planning?
February 21, 2024
Home > News > When should you outsource HR?

January 10, 2024

When should you outsource HR?

A company’s human resources department is the centre of the wheel keeping the spokes of a business moving efficiently.

Its role is to manage the employee life cycle from recruitment through to training, staff retention and replacement while ensuring all data is accurate and all laws are abided by.

With its role being so diverse, there are times when an HR department can be stretched in too many directions and that is when the discussions should start on outsourcing some of its work.
The team which makes up the HR department will be expected to be involved in both long-term strategic decisions, which can include adapting a workforce to a new agenda, as well as ensuring the efficient day-to-day running of the firm.

They are the experts staff turn to with queries over wages, sickness benefits and holiday entitlement but can also be called to deal with more complex matters such as grievances and disciplinary hearings.

But at the times when the demand on HR is threatening its effectiveness, it makes sense to outsource some of its functions.

The simplest move in reducing its workload is to give straight forward administrative tasks to a third party. This might include writing job descriptions, sorting through job applications, checking documentation or ensuring the correct level of pay to staff including those who are on maternity leave or have taken time off due to sickness.

All these tasks are essential but they are also time consuming. By outsourcing them, pressure can be taken off the HR team.

Another area which can be successfully outsourced is training, especially if it relates to a specialist subject. Rather than keep it in-house, a consultancy with expertise in a specific subject – such as the law, new technology or leadership development – could be commissioned to carry out the training and to a higher level than would be possible if it were done in-house. It also leaves the HR team free from disruption to focus on their core role.

Some legal matters affecting a workforce can be extremely complex and will need to be updated frequently. While it is important for an HR manager or director to have full knowledge of legal requirements, a specialist third party can be brought in to check these are being fully implement – and to advise on any areas of weakness.

HR outsourcing can also hugely benefit smaller companies. Major organisations such as government departments, health authorities and universities have large HR departments which can both deal with the day-to-day HR demands while also offering insight, advice and analysis. However, smaller businesses do not have that luxury. Their HR team will be proportionate to the size of their workforce and may struggle to stay on top of new legislation and training requirements as well as fulfilling their core commitments. This is when outsourcing is efficient and economical.

Taking the pressure off HR teams at key times will pay dividends. It will enable them to focus on their everyday tasks, on important strategic work tied into the company’s mission and, perhaps most importantly, ease the workload on overwhelmed teams. In turn, they will be efficient and their expertise invaluable.