There was a time when running the Human Resources department in-house was much less complex. There has been a growing trend for companies to invest in hr outsourcing. If you’re considering outsourcing your human resources, either totally or some of its primary functions, this is becoming a common solution. Most HR departments have grown increasingly more challenging, and in recent years, FMLA, ADA and now Obamacare have made compliance a concern for a lot of companies.
About one-fifth of companies outsource due to a lack of experience in-house. It helps to know where your weaknesses are, since this is as important as knowing your strengths. Therefore, handing off a task you realize that you’re having difficulty handling properly (to someone with some expertise in the area) is probably a great business decision.
HR practices are wrought with complicated issues
Many areas of HR have become complicated with employer concerns over employment practices issues and the threat of lawsuits. HR must concentrate on benefits administration and compliance issues, and these are things that tend to eat up a lot of their time. There are some very good reasons to consider outsourcing human resources, and we can point out some reasons why other companies have come onboard and see this as a plausible solution.
20-25% of companies outsource to save money, which shouldn’t be all that surprising since, after all, what company doesn’t want to save money wherever possible? Nearly 25% of companies also outsource in order to focus on strategy because spreading yourself too thin with a bunch of administrative tasks doesn’t leave much time for planning. More than 20% of companies outsource to improve compliance because it is increasingly challenging to stay in compliance while being increasingly risky to fail to meet standard requirements, so hr outsourcing this risk makes perfect sense.
Investing in hr outsourcing makes sense as a way for many smaller companies to get some needed expertise from professionals experienced with such matters, without the need to hire additional personnel at higher salaries, thereby keeping the main focus on your employees. For larger companies, compliance can be a huge risk as can the concern of legal liability, so outsourcing will allow for extra protection in handling what is often a sensitive area of your business.