Benefits of Outsourcing Human Resources Services According to

Benefits of Outsourcing Human Resources Services According to

Human resources management is a crucial yet complex function for all companies. It’s also a function that many companies decide to outsource. Some of the organizations that are outsourcing their human resource functions do this through a PEO, or professional employer organization. This is much more than just a payroll processing service. PEOs take care of everything, from hiring and onboarding new employees to developing training programs, managing benefits, overseeing compliance, and more.

While outsourcing human resources may not be right for all businesses, there is an array of benefits offered by doing this. Keep reading to find additional info and to see why this may be a smart move here.

Spend Less Money on Salaries

Something the San Francisco Department of Human Resources has found is that outsourcing is a smart move. On average, a human resources manager will make around $75K per year, and this does not account for benefits. Depending on the business size, even small and medium businesses will be spending thousands of dollars on their HR staff according to Outsourcing these jobs can help a business save a lot of money.

Reduced Benefits Costs

Since the outsourced service will have access to an array of resources in-house HR workers do not, they can likely negotiate better rates for more candidates. This ensures that smaller businesses can get rates that are typically reserved for bigger companies with more staff members.

Reduced Costs for Hiring New Employees, Onboarding, and Training 

When outsourced services like Porte Brown are used, it is possible to reduce the costs related to hiring, onboarding, and training new employees. It is estimated that it will cost about $4,129 to hire a new employee and over $1,200 to train them. The outsourced service will help ensure the business is hiring the right people, which reduces turnover and related costs, and that the resources are in place to reduce the overall cost of hiring someone new.

Avoid Noncompliance Penalties

When hiring (or firing) employees, certain issues must be addressed. Sometimes, businesses with an in-house HR department make mistakes simply because they are not aware of the rules and regulations in place. This is a non-issue with an outsourced firm, as they can help ensure all employment regulations and laws are adhered to at all times.

Spend Less Time Dealing with HR Functions

With an outsourced company handling all HR tasks, other employees can focus on growth goals and strategic sales. Research has proven that, even when business owners spend 50 or more hours working each week, they spend only 30% of the time on business functions. The remainder of their time is spent on various administrative tasks that will not contribute to the company’s revenue.

Finding the Right HR Company

When it comes to human resources, there are many factors to consider. Be sure to keep the information here in mind to see why outsourcing these services is such a smart move for almost any business. Just make sure to find the right company to ensure the benefits here are seen.

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