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    Home»Business»How to Outsource Your HR Team

    How to Outsource Your HR Team

    Trevor James.cBy Trevor James.cNovember 20, 2022No Comments5 Mins Read
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    Owning and operating your own business sounds like a dream for a lot of people. You’re in charge, and you call the shots. It can be thrilling to see the public flock to the services you provide or buy up your new product. There are some nitty-gritty details behind all that excitement, though.

    Unless you’re a solopreneur, your company will have employees. A human resources leader or team is a must to successfully manage payroll, benefits, taxes, and more. All that gets complicated, and the cost of handling it in-house may be cost-prohibitive. So, what do you do? 

    Consider outsourcing your HR team. Doing so can cut your costs and help you stay compliant with the laws anywhere you do business. Moving all your HR functions outside the company may sound strange and difficult, however. Keep reading for some tips to effectively make this shift.

    1. Choose an Employment Partner

    A good employment partner can save you a lot of headaches. This is particularly true if you have international employees, as a growing number of companies do these days. The question is whether to partner with an employer of record or a professional employer organization. When you’re thinking about an EOR vs. PEO, there’s one big thing to keep in mind. 

    Both an EOR and a PEO can manage HR responsibilities, including payroll, benefits, and tax deductions. The main difference is that an EOR hires people in other countries on your behalf. You don’t need to establish a branch office or own any business entity in those countries. The EOR assumes responsibility for making sure you comply with employment laws in other nations. 

    In contrast, if you wish to hire international employees and work with a PEO, you must have a business presence in those countries to co-employ your workers with the PEO. Your PEO can handle everything from issuing paychecks to administering benefits, but you’re responsible for staying compliant with local laws.

    2. Pick Your Approach

    There are many options available when you’re thinking of offloading your HR tasks. One isn’t outsourcing per se, but rather implementing HR software as a service (SaaS). This approach lets you manage HR needs related to hiring, onboarding, and benefits administration with a cloud-based, centralized platform. Would you prefer to work with people instead of technology? Look into whether business-process outsourcing with a third party is right for you.

    Whichever vendor you select, review the services they offer to ensure they meet your needs. If you contract with them, what responsibilities will you retain — or take on? How much will you pay for their assistance, and can they scale with you as you grow? Be sure there’s also a resolution plan in place for when HR problems pop up, because they will. 

    3. Establish Clear Communication

    Stop for a moment and think about the fundamentals of a successful relationship. There’s a good chance open communication came to mind quickly. It’s certainly true for your personal life. Your business life is no different — especially when you’re talking about HR management.

    Set yourself up for success by establishing communication expectations early. Figure out what an effective partnership looks like for you. Discuss that vision thoroughly so everyone is on the same page. Identify any sticking points or details that need clarity and clear them up before you launch the partnership.

    4. Invest Time in Transferring Responsibilities

    Maybe you’re switching from in-house HR to an outsourcing vendor. Or perhaps you’re launching your business with an outside vendor from the start. Either way, you’ll need to take the time to educate your new HR partner on the ins and outs of your company. You have lots of knowledge in your head that you must share.

    After selecting a vendor, dedicate the necessary hours to explaining your business processes, systems, and organization. Walk them through your company culture so they have a good understanding of your employees’ needs. If you have to, don’t be afraid to keep a few responsibilities in-house — or at least create some redundancies. Doing so can serve as a backup in case your external HR partner ever falters.

    5. Monitor Performance

    Deciding to outsource your HR functions doesn’t mean you don’t have to think about them anymore. To be clear, farming out these responsibilities is not a “set it and forget it” solution. You still need to stay engaged to keep everything on track. 

    It’s easy to assume all is fine if you don’t hear any complaints. That’s not always reality, though. Make a point to touch base with your employees regularly. Ask them if everything is OK or if they’ve experienced any HR-related hiccups. When you open the door for a conversation, you may learn about some opportunities for improvement.

    Also, don’t forget to review your key performance indicators or any cost efficiency metrics. Keeping tabs on these factors regularly lets you address any problems sooner rather than later.

    Letting the Pros Handle HR

    When it comes to keeping your business running smoothly, there are many factors to consider. It’s sometimes easy to overlook how important HR is to daily activities and your overall success. Effectively fulfilling your HR responsibilities can be complicated and time-consuming. 

    To save yourself the extra hours and dollars, consider outsourcing your HR responsibilities. The right HR partner can streamline your company’s functions and let you focus on your business. 

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