To outsource HR for small businesses is a strategy that allows business owners to focus on growth while ensuring their human resources needs are expertly managed. Whether you’re a small business with just a few employees or you lead a quickly growing team, HR outsourcing can provide the flexibility to handle HR functions without the need for a full in-house team. Here’s everything you need to know about utilizing HR services as a small business.
Outsource HR for Small Business – Key Takeaways:
- HR outsourcing for small businesses provides flexibility in managing HR needs without a full-time in-house team.
- Businesses can outsource HR functions like compliance, recruitment, employee training, workplace investigations, and more.
- Outsourcing can also relieve internal HR staff, offering help with heavy workloads or providing fresh, external insights.
What is HR Outsourcing?
Many small businesses utilize HR outsourcing. In this case, HR outsourcing is when a small business hires an HR firm to handle some or all of their human resources needs. This is a fairly common and growing practice for small businesses! In fact, 35% of businesses with fewer than 1,000 employees outsource one or more HR functions.
Any business size can outsource their HR needs. We often see that small businesses find HR firms particularly useful. This is because they take a big challenge off of a manager’s plate. HR outsourcing can be as comprehensive as handing over the entire HR function to an outside team, or as specific as contracting a firm to manage specialized projects like recruitment or employee training. This flexibility allows small business owners to get the HR support they need when they need it.
At HR NOLA, for instance, we provide many HR services for small businesses. This customizable approach ensures that your business only pays for the services it truly needs.
Why Outsource HR for Small Businesses?
One of the main reasons small businesses choose to outsource HR is the flexibility it provides. Small businesses often don’t have the capacity or need to maintain a full HR department. However, HR is a critical aspect of all businesses and one that small businesses can’t afford to ignore. Human resources is a surprisingly underlooked component of small businesses. This is surprising considering that it can have major legal implications when handled improperly. In a study by Secure Data Recovery, the vast majority of respondents (88%!) working for a small business didn’t have a dedicated HR person. For 68% of respondents, their manager was also the HR manager. This gap shows that HR is overlooked in small businesses.
But what if you already have an internal HR person? We regularly work with small businesses that have an HR team member. Commonly, dedicated HR staff can’t complete all of the projects they need to in a given year. Outsourced HR assistance is a great practice and a huge help to your HR manager! A recent Society for Human Resource Management (SHRM)’s State of the Workplace Report found that nearly 75% of HR professionals feel their department is unable to keep up with their workload. Helping internal HR take projects off their to-do list can help in creating a balanced workload.
Using an independent HR firm for strategic projects also offers fresh insights into your business. With an outside eye, they can help identify compliance issues you may have overlooked. They can also bring innovative solutions to improve your workforce management. By choosing the right HR partner, you can ensure that your operation runs smoothly, stay compliant with changing regulations, and support your business growth.
How to Outsource HR for Small Business?
Outsourcing HR starts with identifying where your business needs support. It’s not a one-size-fits-all solution. Which is why it’s important to work with a provider who takes the time to understand your unique needs. At HR NOLA, we begin our process with a 30-minute discovery session to learn more about your small business and assess the areas where HR support could make the biggest impact.
After deciding to work together we often move into the assessment phase, where we look more closely at your workforce, HR practices, and any existing gaps. This might involve reviewing your current compliance standing, analyzing employee relations issues, or identifying training opportunities for your management team. Based on this assessment, we develop a customized action plan designed to align with your business goals and budget.
Our goal is to provide seamless HR support that boosts your business’s productivity and helps you avoid common HR pitfalls. This personalized approach allows us to deliver targeted solutions that help your business thrive.
What HR Special Projects Can Be Outsourced?
Small businesses often don’t need full-time HR staff, but there are still many HR projects that require expert attention. Outsourcing these special projects allows you to get the HR expertise you need without making a long-term commitment to a full-time employee. Here are some key HR projects that are commonly outsourced:
- HR Audits: Regular HR audits are critical for ensuring compliance with employment laws and identifying areas for improvement in your HR practices. A third-party audit can provide an objective review of your current HR processes and help identify any gaps in compliance or efficiency.
- Talent Acquisition: Finding and recruiting top talent is one of the most important HR functions. At HR NOLA, our Talent Acquisition Consultants specialize in sourcing candidates who not only meet the skills requirements but also fit seamlessly into your company culture. We ensure that your new hires are a good match both in terms of hard skills and soft skills.
- Employee Handbooks: A well-crafted employee handbook is essential for setting clear expectations and ensuring compliance with labor laws. Outsourcing the creation or update of your handbook ensures that it reflects the latest regulations and is customized to your business’s specific needs.
- Workforce Training & Development: Training programs are vital for keeping your team up-to-date on best practices and regulatory changes. We specialize in training that helps your team work better together and ultimately boost your business. Training programs like Respect in the Workplace and Managers & Supervisors Skills for Success help businesses to build a strong and compliant culture.
- Workplace Investigations: Conducting an impartial investigation into workplace disputes or allegations of misconduct is essential for maintaining trust and avoiding legal complications. By outsourcing workplace investigations you can ensure that the investigation is handled fairly and efficiently.
- Dispute Mediation: Mediation helps resolve conflicts between employees or between employees and management. Our professionals work to find a solution that both parties can agree on, reducing the likelihood of escalation to legal action.
Difference Between HR Outsourcing for Small Businesses vs. Large Businesses
HR outsourcing can benefit businesses of all sizes, but the needs of small businesses differ significantly from those of large enterprises. Large companies may use HR outsourcing to supplement their in-house HR team, often for large-scale projects or specialized services. Small businesses, on the other hand, often outsource HR to fill in gaps where they don’t have in-house expertise.
Small businesses typically focus HR outsourcing on essential services like compliance, payroll, and employee relations. Large companies may outsource more strategic functions like executive recruitment, succession planning, or large-scale training programs. Additionally, small businesses rely on HR outsourcing to gain access to HR technology and resources that would otherwise be out of reach due to budget constraints, while larger businesses might already have these resources in place.
We Can Help
At HR NOLA, we offer a wide range of HR services for small businesses. From HR audits to workforce training, we provide customized solutions that address your unique HR needs. Let us take HR off your shoulders so you can focus on growing your business! Contact us today to learn more about how we can help your business thrive with our expert HR outsourcing services.
← Blog
