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How HR Outsourcing Can Help Your Small Business

FedEx has over 300,000 employees, and they're still growing!

SummaryWhat Happens When HR Falls Behind?Organizational StrengthImprove Overall ProductivityWhat Outsourced HR Services DoPerfect Payroll SolutionDeveloping Long-Term HR StrategiesPEO vs HRO Corporate HRExcellent Employee Retention and SecurityBetter BenefitsDiscover HR Outsourcing

By operating an airtight human resources operation, FedEx can remain efficient and compliant. If you also have big aspirations for your business, you will need a strong HR team. However, you don't have to do everything in-house.

An outsourced HR team can do more than you think. They can help you avoid wasting capital, maximize growth opportunities, and more.

Is HR outsourcing the right solution for your business? Keep reading to find out!

What happens when HR falls behind?

By outsourcing HR, you can avoid some of the biggest hurdles in business. For example, when HR falls behind, company culture immediately suffers. A bad corporate culture means that employees lack a sense of purpose or loyalty.

Without any guidance, business protocols get pushed aside and customers remain dissatisfied. Not to mention all the security breaches that can occur when the HR department is not fully staffed.

Then, when the HR department falls behind, you can miss revenue opportunities. Instead of getting your customers what they need quickly, your business will struggle to keep up.


When do you think of UPS? What comes to mind? Do you consider the size of the company has grown? You may find it impressive how UPS can satisfy so many customers with so many safe and on-time deliveries. UPS is another testament to what a strong HR department can help you with.

They are able to operate effectively because they have a strong operational organization. Being meticulously organized is one of the things the HR department can help you with.

While letting HR functions fall behind leads to operational nightmares. You will not meet quality standards and accidents can happen! In addition, your business will also begin to feel the effects financially.

Inefficiently run businesses might be able to cringe for a while. However, eventually, the disorganization catches up with them. Whether it's an accident in the workplace, or something else, it always makes up for it.

To avoid all the nightmares that a neglected HR department can cause, stay on top of your company's HR needs. Together with the third party, you can ensure that all HR responsibilities are properly outsourced.

Improve overall productivity

Now that you know what happens when you don't have an effective HR department, let's talk about the benefits of running a great one! For starters, you can start focusing on the good stuff.

Instead of worrying about cutting checks, you can focus your energies on growing the business. Start looking for new markets that could use your product or service. Start exploring possible partnership opportunities and consider investment meetings.

When you don't have to deal with all the trivial business tasks that the HR department can perform, you can help your business thrive. Before you know it, you'll have more time in the morning than you know what to do with.

In addition to stress-free mornings, get ready to usher in carefree evenings. When you have a reputable HR department handling things, it's like a weight lifted off your shoulders.

As a business owner, you are always entrusted with all kinds of responsibilities. Having the ability to relieve yourself of these burdens can be a game-changer. Your employees will probably notice right away that you seem like a different person. Instead of constantly running scenarios in your head to solve problems, you'll know you have a trusted HR team running things. Now you can stop wasting your time on minor things.

What do outsourced HR services do

So far, we have expressed how beneficial HR outsourcing can be for your business. But what exactly will the outsourced HR department do? Great question!

One of the biggest responsibilities of your HR department is to follow compliance procedures. HR compliance involves establishing policies and procedures for your workplace.

The idea here is to use work practices that coincide with your state's labor laws and regulations. Long-term plans should also consider the company's mission and resources.

When a company does not meet compliance, several sanctions can take place. Penalties can range from money to loss of necessary business licenses.

For example, you must follow all federal, local, and state labor laws as an employer. If at any time you are suspected of not complying, you may be subject to an audit. An enforcement agency will complete the audit and possibly issue fines if they cite compliance issues.

Next, your HR department will work with your legal team to help your company comply with wage and hour requirements. Together they will tackle any potential compensation issues or issues that may arise from watchmaking.

For example, employees should log every hour they work for your business. This includes any work the employee performs outside of regular working hours.

Even if the work was not requested, the responsibility is still to report an accurate scorecard. If a company doesn't carefully document all of its employees' working time, it could face a world of legal complications.

Perfect payroll solution

Are you dreading doing the payroll? Then we have good news. When you outsource your HR department, you can also request that they take care of your payroll responsibilities. If you already have a payroll service in place, they can work alongside any HR team you choose.

What are some of the payroll services and HR outsourcing companies can help you with? First, they will be able to assist your business with payroll setup. This includes new employees arriving in your system and all ready to receive their first paycheck.

Then you can transfer the tax filing responsibilities as well. Printing, filing and sending w2 and w-4 will no longer be a concern for you. Instead, you'll have a trusted HR team to handle everything for you.

They will also take care of all payroll cycles. Whether your business works weekly, bi-weekly, semi-monthly, it doesn't matter.

An experienced HR team will be able to handle any payroll cycle used by your company. This includes calculating each employee's sick leave, vacation, and paid time off.

When an employee needs employment verification before being onboarded, your human resources department can also help. They will be able to check the employment history of current and past employees.

Then modern HR departments will be comfortable working with online payroll submission. In other words, say goodbye to paper-based taxes and hello to digital convenience.

By automating flat-rate direct debits and using an online platform. As a business owner, you will also have access to the integrated pointing system. This means you can get real-time reports on your employees' activities.

Developing long-term HR strategies

Then, your HR department can help you develop long-term strategies for your business. Your exact business needs are unique, so you'll need to customize the design to suit your needs.

For example, business owners will have to choose between a single-source strategy and an HR BPO strategy. If you don't know what these two strategies correspond to, don't worry. We'll provide you with a brief overview and your HR team can recommend the best one for your business.

Let's start with the BPO. BPO stands for business process outsourcing agreements. A BPO is the best strategy for employers looking to contract specific business tests. For example, you can set up a BPO to outsource payroll to a third-party vendor.

Single-source outsourcing is when business owners outsource multiple responsibilities. Instead of outsourcing a task, they will find a third party who can solve all their heavy administrative tasks.

The single-source HR professional will cover the entire employee lifecycle. They begin with recruitment and continue with time and labor supervision. This includes payroll management, employee document management, and benefits management.

We suggest you opt for a single-source outsourcing solution as it is more comprehensive. Instead of keeping track of multiple contracts with various third parties, you'll have a one-stop shop, like

PEO vs HRO Company HR

Then you will also hear the terms PEO and HRO when you start searching for a third-party team. A PEO is a third party that functions as a type of co-employer. They will technically be the ones who hire the employees, and it will be their name that will appear on the file.

The co-employment approach is simply a way of sharing your administrative responsibilities. You will always maintain full control over business development decisions and employee functions. However, the PEO will be able to negotiate insurance claims and process legal notices.

What is an HRO? An HRO is a custom agreement policy. As a business owner, you will be able to select precisely which responsibilities you want the third-party team to take on.

Are you going to ask HR to handle employee benefits management? Do you want the HRO team to create manuals for employees? Think of your HR HRO team as on-call support, ready to help you anytime.

Take a moment now to decide whether your business would benefit the most from a PEO or ho plan. Next, start researching a supplier by searching the list of trade associations.

You will need to look for third-party teams that know your particular industry. Once you have found a potential business, contact us to arrange an initial consultation.

Tell the seller exactly what you are looking for. The more specific you can be, the better. Even if the third party you contact is unable to accommodate you, they may be able to refer you to a sister company that can.

Excellent employee retention and security

Then let's look at exactly how outsourcing your HR team can help you onboard new employees.

It's easy to let little things slip through the crack in the middle of all the onboarding documents. Not getting an employee's tax information or forgetting to scan a license are common mistakes. Unfortunately, the slightest integration error can lead to complications down the road.

Luckily, a third-party HR service can help keep you out of trouble. They can attract top talent, bringing only the best candidates to your team.

By finding the best new recruits, you will be able to reduce the high cost of rotations. In no time, your business productivity will skyrocket!

Better benefits

Last but not least, HR outsourcing means better employee benefits. You'll be able to stay up to date with all the latest worker rights while keeping your employees happy.

HR professionals will know how to research the best programs for employees. This includes recognition programs and setting up a comp. They will also provide employees with health insurance options. Comprehensive dental, vision and health plans are easy to find for HR teams.

What kind of employee recognition programs could help your business? There are so many! Compensation is not the only thing that motivates employees.

An experienced HR company will know how to get to the heart of what your employees want. Modern appreciation programs also find ways for co-workers to express their gratitude to one another! One way your HR team can do this is to create space in the online portal for positive feedback.

Discover HR outsourcing

Do you need more reasons to start outsourcing HR today? Building a productive business, adhering to labor regulations, and handing over payroll…it almost sounds too good to be true. But when you find the right HR team to work with your company, the sky's the limit.

Since there are so many options, you'll want to start your search today. Start looking for a reputable company and arrange an initial consultation. For more tips like these, see what the rest of the site has to offer.