When to Outsource Your HR

As a small business owner, you’ve got a lot of decisions to make. Most of them revolve around how to make more revenue, cut costs, and get more done. Human resources is a necessary function of any business once you hire your first employee. And once you have that first employee, you have another decision to make — figuring out the best method for handling HR.

If you’re in an in-between stage and need to make a decision about your HR needs, we can help. Here’s when it makes sense to outsource and when it makes sense to bring your HR department in-house.
Outsourcing Human Resources

Not sure whether you should outsource the HR functions of your business? If any of these fit you or your business, the answer is yes.

You Spend Too Much Time on HR

When your business is small, you do nearly everything. There comes a point in every business when the time you spend on one task takes away from your ability to generate revenue and run your company. Once HR sucks up most of your time, the cost to outsource will be made up in productivity.

You Don’t Know HR Rules and Regulations

No one wants to deal with liability on any level, but certainly not with your employees. If you don’t know (or can’t keep up with) hiring rules, EEOC requirements, payroll taxes, and the other functions of human resources, it’s time to outsource.

You Need to Save Money

Maybe you’ve had an HR person on staff but now that’s no longer financially feasible. Outsourcing your human resources needs saves money. You don’t have to pay for training or benefits. You’re paying a fee for the service but not a full salary.

Things are Moving Too Fast

Ideally this is because business is growing and you need to hire quickly, but any change that happens too fast can be overwhelming. With an outsourced HR provider handling the work for you, things get done quickly and more efficiently letting you focus on bringing in revenue as your business grows.

You Have Low Turnover

A hiring boom notwithstanding, if you don’t do a lot of hiring and firing, outsourcing your HR needs can make a lot of sense. Rules and laws may change from one hire to the next, especially if it’s been a while. You might not remember everything you need to do. And it’s difficult to justify a full-time employee when the job doesn’t require a lot of extra work.

Keeping Human Resources In-House

Not every business should outsource their human resources. It may make more sense to hire someone full-time to do the job for you.

Your Business Deals with Constant Turnover

A lot goes into hiring people and letting others go. Job descriptions have to be written. Training must be done. Interviews have to take place. If the volume of your turnover is high enough that the daily tasks equal a full-time job, it may make sense to hire someone.

You’ve Got a Lot of Employees

An outsourced HR service can definitely help large companies, but many business owners begin to build HR departments once they hit 100 or more employees. At that point it may make more economic sense to have someone on staff to do the job. If you’re below the 100 person threshold but know you’re headed in that direction, you may want to hire an HR person early so they’re ready to help you grow.
Are you ready to outsource your HR needs? Contact Charlotte Payroll today at 704-887-5511. We can help you at every stage of your business’s growth. You don’t have to keep up with employment law, hiring and firing best practices, or onboarding new employees. Get back to building your business, and we’ll help you with the rest.

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