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4 HR Areas That Smart Companies Outsource

Posted on August 29th, 2017 with No comments

Companies Outsource

This isn’t your HR team’s first rodeo. From onboarding to payroll processing to recruitment, your staff can do it all.

But “can” is not the same as “should.” Every hour your HR team spends number-crunching is one it can’t spend crafting culture. Every dollar it spends on compliance is one that can’t be spent recruiting or onboarding new hires.

Increasingly, company leaders are realizing their HR resources are better spent outsourcing certain functions. Eighty-five percent of firms now lean on outside organizations for at least some HR needs, growing outsourced HR into a $165 billion industry. In fact, 32 percent of executives surveyed in Deloitte’s 2016 Global Outsourcing Survey cited HR as a top area for outsourcing growth, second only to finance. 

So how do you want to spend your HR resources? Wouldn’t you rather devote more time to revenue-generating work and less to internal tedium? Wouldn’t your HR team rather focus on its core competencies, knowing that other essential work will still get done?

Which HR Tasks Should You Outsource?

Whether your goal is to strategically offload time-consuming HR tasks or outsource the department, modern HR providers make it possible. The following four areas are prime candidates for outsourcing:

1. Recruitment

In July, the U.S. unemployment rate fell one-tenth of a percentage point to a 16-year low of 4.3 percent. With unemployment so low, finding the right talent is tougher than ever. Technical candidates can be particularly elusive, with 86 percent of hiring managers surveyed by Indeed saying they struggle to fill engineering and technology roles.

Outsourcing recruitment is also a smart idea if your company hires gig workers. When it comes time to hire seasonal or contract-based help, one option is to crawl online marketplaces for months, email hundreds of people, and hope for a dozen applicants; the other is to let experts fill your pipeline, interview people as they’re referred to you, and build up a bank of trusted contract workers.

2. Compliance

The patchwork of local, state, and federal employment laws is larger and more confusing than ever. Do you realize that 40 city and state jurisdictions now mandate paid sick leave in some form? Is your company part of the 10 to 30 percent of employers that misclassifies employees as independent contractors, opening it to multimillion-dollar penalties?

To protect your company, consider using an employer of record for contract workers or out-of-state employees. EORs serve as the legal employer for contingent workers, meaning they also assume all wage and hour liabilities for those workers. What’s more, EORs can handle payroll, back-office support, preemployment screening, and unemployment insurance needs. With a top-rated employer of record, compliance can become a challenge of the past.

3. Onboarding

In today’s worker’s market, clear and effective onboarding is a must. Onboarding is your chance to set up strong employer-employee relationships, boosting retention and encouraging new hires to spread the word. 

An engaging onboarding experience shouldn’t start with old-school applications and mind-numbing manuals. Onboarding software saves time and paper, and in most cases, makes training materials accessible on mobile devices.

If you don’t have such software, consider partnering with an HR provider that does. Millennials want modern HR technology, and your HR team cares about efficiency and accuracy. Seek an employer of record with an automated online system to onboard contingent workers. For internal employees, look to companies like iCIMS Onboard or EmployStream, which offer cloud-based and user-friendly onboarding software.

4. Payroll

Does payroll ever feel like a chore? Month after month, your HR staff spends hours making the same transactions and answering the same questions. Don’t you think they’d prefer to spend that time doing something more creative?

Payroll’s routine nature has made it one of the most popular HR duties to outsource. In fact, market researcher Technavio expects payroll outsourcing to grow by 6 percent year over year between now and 2021.

To outsource payroll for contingent workers, look to an employer of record that offers payrolling services. Offloading payroll for the entire organization means enlisting the help of an administrative services organization. Whichever you choose, outsourcing payroll saves time and cuts risk by ensuring tax and reporting deadline compliance.

Unfortunately, HR resources are finite, but your staff knows where they should be spent. By outsourcing the little things that bog team members down, you help them maximize their working hours. Focus on what your HR team does best and outsource the rest!

By: Sara Jensen, VP of Business Development

 

Sara Jensen is the vice president of business development at Innovative Employee Solutions, a leading nationwide employer of record that specializes in human relations and payroll services. Founded in 1974 in San Diego, California, IES has grown into one of the city’s largest women-owned businesses and been named one of its “Best Places to Work” for 10 years in a row.

Prior to joining IES in 2011, Sara served as director of distinguished events for the American Cancer Society. She also worked as a development resource specialist for the San Diego branch of nonprofit Social Advocates for Youth. A Washington native, Sara earned a Bachelor of Arts in communications from Western Washington University.



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