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Outsourcing your human resources needs, in a nutshell
Most small to medium sized business owners know the frustration of spending more time
than they want to on activities that don't generate income for the Company. Outsourcing
your HR needs may not suit all businesses, but for many it can give them access to specialist
skills and knowledge, reduce risk and provide savings on cost because an in-house HR person
is no longer needed, or, freeing up the person that covers the function to allow them to
focus on work that does generate income. What sort of services might you need?
At the very least you will need to ensure that you meet your legal requirements in terms
of Health and Safety, policies and contracts. You may need additional help in setting up
performance management processes or dealing with employee relations issues, such as legal
claims, redundancy and restructuring the business, grievances and dismissals.
How much does an outsourced service cost? You should always establish up front the way
in which the service is billed. Providers should be able to give you an estimate of
cost, or at least a range of costs for a specific project, whilst on-going support services
are normally supplied on a retained basis with either a monthly fixed fee or an agreed
hourly rate. However the service is set up, you should
ensure you receive an itemised billing report so that you can see exactly what you are paying
for, and this allows you to decide if you are getting value for money.
But when does it make sense for you to outsource? If your admin processes are slowing down the
productivity of your company, it's time to consider outsourcing the management of your
human resources. Whilst outsourcing doesn't suit all businesses, for some it's the best
way to ensure that what is arguably their most valuable asset is well managed, freeing
you up to concentrate on your core business and generate income.