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Outsourcing companies and Human Resources

These days, many small companies are outsourcing human resources to handle payroll, tax filing, unemployment insurance claims, benefits administration, health and productivity, accounting, and more to save time, cut costs, and increase efficiency. As a small business owner, you need to weigh the costs of your time or the costs of having HR outsourcing companies do the same tasks.


Being able to give undivided attention to many details, HR outsourcing companies are able to guarantee all papers are filed properly, while your company complies with all tax and employment requirements. A third party accounting agency ensures trustworthy financial figures and avoids opportunity for fraud. Therefore, many small businesses that outsource human resources may experience an increase in workplace efficiency and high quality of work by being able to devote more time to doing what they do best, rather than necessary paper work.

Make a human resources plan to evaluate how much time is needed to effectively complete each task, then make a human resources checklist of necessities to help compare what hr outsourcing companies offer 


One factor that has been critical to the growth of outsourcing is its potential to offer cost savings. It’s a controversial point, not least because those savings often mean redundancies. Phil Clarke, a director of HR consultancy Independent, is ‘convinced’ that cost is still the number one driver of outsourcing decisions, whatever spin outsourcing providers or their clients may put on it.


The decision of whether or not to outsource can be straightforward if you’re a smaller organisation: if you don’t have the expertise and can’t afford to hire another person, it’s a no-brainer. For larger companies that have ongoing HR needs, it’s perfectly feasible to bring specialists in-house, or use a mixed approach.


The key to completing such a project successfully, according to Hall, is seeing the outsourcing provider as an extension of your own team. ‘We got them temporary security passes and they came to work in our retail outlets, and talked to staff and front-line managers to help them with the screening process,’ he states.

Cost reductions were roughly 20 per cent when you factor in management time saved, and the pre-interview screening process improved too, so that five jobs were offered for every ten candidates interviewed, as opposed to the usual three. ‘The commitment of the line managers doing the interviews increased tremendously because they were seeing better people,’ says Hall. Of course, outsourcing companies arrangements don’t always go smoothly, and they are easier to get into than to get out of, according to Bevitt. ‘They can go drastically, drastically wrong. The danger is, if you outsource, especially if the employees don’t transfer


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