A lot of companies find maintaining an effective internal human resources department to be a considerable challenge in today’s world. Human resources (HR) is becoming increasingly regulated, so businesses have had to re-examine their strategy to keep their practice above board. If you’re in a similar situation, you might benefit from human resources outsourcing.
Your business can have all of its HR needs covered by outsourcing to a professional employer organization (PEO). Your company also has the option to either partially or fully outsource its HR needs how you see fit. In partial outsourcing, your company would share responsibilities with your PEO and they would manage certain tasks to lessen your HR team’s load.
NetPEO Can Help You Find a Provider That Meets Your Company’s HR Needs
We’ll help you choose between partial and complete HR outsourcing. If you decide to hand your entire HR department over to a PEO, you’ll have to enter a relationship known as co-employment. This means your PEO will take over your company’s HR tasks and will be listed as the employer on record for insurance and tax purposes.
Meanwhile, your HR manager will take on the responsibility of being the liaison between your company and your PEO. Their only focus on HR will be to manage the company-vendor relationship.
The best way to discover the ideal HR solution for your company is to talk to the outsourcing experts at NetPEO. Our job is to match you up with the ideal HR outsourcing company for your business.
Benefits Your Company Can Enjoy by Outsourcing HR
Small enterprises and conglomerates alike find that some HR tasks are too complicated to handle on their own. Luckily, they can improve their HR functions by outsourcing them to a PEO. If you choose to work with a provider, here are some of the benefits you can expect:
Having an in-house HR department can be costly, especially for small and medium-sized companies. A functioning human resources department needs extra office space and experienced staff.
Outsourcing HR functions is cost-effective for SMBs because it’s less expensive than paying to have employees work in-house. In addition, having a professional organization handle repetitive and non-revenue generating tasks like payroll or drug screening means management and critical staff can focus on more important jobs.
PEO costs are also flexible, as you can opt to outsource as many HR duties as you have the means to. You can also discontinue certain services at any time to save money. We will help you find a provider that meets your business’s outsourcing needs and reduce costs.
Smaller companies often struggle to provide employees with competitive benefits, especially now with increasing health care costs. An HR outsourcing organization can provide businesses with access to large group benefits like:
- Dental plans
- Health insurance options
- Credit unions
- Retirement plans
A lot of job seekers today consider the type and quality of benefits a company offers as a major deal breaker. Plus, excellent benefits means higher employee satisfaction and lower staff turnover.
Guaranteed HR Compliance
HR rules and regulations have drastically changed over the last decade as human resources and labor laws have become more complicated. This means there’s even more pressure on companies to comply with legislation. Unfortunately, keeping on top of all these rules can be daunting to a small and busy HR department.
An HR outsourcing company can help with risk management and government compliance. These experts can help you comply with all the requirements your business is subject to. They’ll help you avoid expensive lawsuits and penalties, and draw up plans for changes if new laws are introduced.
Better Staff Development
HR outsourcing can also improve how your business manages things like employee development and performance. Your providers will be able to execute performance management plans to make sure all employees follow business procedures and policies.
Outsourcing providers can also monitor staff performance regularly and report results to your management. This will lessen manager workload by reducing the number of administrative duties they have to focus on.
HR Functions That Can Be Outsourced
There’s no fixed playbook with regards to outsourcing HR functions. It’s up to your company to decide what tasks you want to keep in-house and which ones you want to hand over to a human resources company.
HR initiatives that are often better managed in-house are:
- Capital strategy development
- Compensation development and delivery
- Employee relations
- Performance management
- Talent development/training
Meanwhile, tasks like the following are usually outsourced:
- Background checks
- Benefits administration
- Developing/updating employee handbooks and company policy manuals
- Drug screening
- High-volume hiring
- Independent contractor compliance
- Temporary staffing
Types of HR Outsourcing Companies
There are three types of outsourcing companies that you can choose from:
- Human Resource Organizations (HRO)
- Professional Employer Organizations (PEO)
- Administrative Services Organization (ASO)
Most HROs allow corporations or big businesses (those with 1,000+ employees) to choose which human resources tasks they want to outsource. If a company decides to outsource select HR functions, a co-management relationship will be put in place.
In this case, the HRO will take on full responsibility for all HR tasks that are outsourced. Meanwhile, the strategic and vital HR roles will remain in-house to be performed by employees of the client company.
A PEO can be extremely beneficial to small and medium-sized businesses (those with under 200 employees). Companies that outsource their HR needs to a PEO will enter into a co-employment relationship with them. This means the PEO becomes the employer-of-record while the original company becomes the on-site employer.
As employer-of-record, a PEO will assume responsibility for workers’ compensation claims and taxes. They’ll also secure lowered rates on health benefits and retirement packages by combining all the employees from their other clients. PEOs can also handle tasks like background screening, payroll, performance management and recruitment.
As the name implies, an ASO can take on administrative duties like payroll processing, direct depositing of payments, and tax filing. An ASO will also help answer employee questions regarding compliance and legal issues, retirement plans, dental/medical insurance, and workers’ compensation.
An Outsourcing Company Can Give You Access to Helpful Software
An outsourcing company can also help your business by providing you with helpful software and state-of-the-art technology. Depending on the provider you choose, you could benefit from managerial and employee payroll software, as well as computer programs designed to facilitate an effective onboarding and training experience for new hires.
Cutting edge technology can help you and your workers save time and work more efficiently. If you think you could benefit from powerful HR and payroll technology, we can help you find a provider that has the tech your company needs to flourish.
What NetPEO Can Do to Help Your Business Find the Right HR Outsourcing Company
Our job is to help you find an outsourcing company with the experience and resources necessary to meet your HR needs. In order to do this, we’ll need to learn more about the HR duties your business is having difficulties with.
Once we know more about the weaknesses in your HR department, we’ll be able to find a PEO, HRO, or ASO that has what it takes to manage the tasks you’re having issues with. Once we’ve narrowed down the pool of options, we’ll send you a list of outsourcing companies that will be sure to improve your administrative services.
What sets NetPEO apart from other outsourcing company brokers, is that we don’t stop working for you once you’ve partnered with a provider. In fact, we’ll stay in touch with you throughout the entirety of your co-employment or co-management relationship to address any problems or concerns you have about it.
Contact NetPEO to Find a Provider That Meets Your HR Outsourcing Needs
Outsourcing all or just select HR functions is now a widely accepted practice in the business world. At NetPEO, we offer a number of outsourcing services that will help your business run more efficiently and save you money.
We’ll help you connect with the PEO, HRO, or ASO that best suits the unique HR needs of your business. If you think HR outsourcing is right for your company, call us or fill out a contact form on our website to schedule a free consultation and receive a quote for your new provider.