There are several benefits to partnering with an HRO company for both employers and employees, depending on the services your business needs.
1. It saves time and money.
Hiring an HRO service to take care of your HR processes can save your business time and money. Instead of wasting hours performing administrative tasks manually, you can streamline your efforts by outsourcing certain tasks. That means you can reclaim your valuable time to perform revenue-generating functions that will improve your business.
Hiring an internal HR staff can cost 50 percent more than outsourcing your HR functions, according to Asure Software.
2. It helps you maintain legal compliance.
Federal, state and local employment laws are changing constantly. As a result, legal compliance has become difficult for many organizations to manage on their own, especially with the recent trend of hiring remote employees located around the state or country. Hiring an HRO to keep you compliant is often easier than trying to stay up to date with a myriad of evolving laws, especially as your company operates in multiple regions.
Your HRO can help maintain the security and privacy of your employee data, including compensation and personal matters. It can also ensure your company’s compliance with federal, state and local regulations surrounding employee benefits ― healthcare, 401(k) retirement plans and time off policies ― harassment and discrimination, workplace safety measures, workers’ compensation, payroll processing and taxation, HR policies, employee discipline and termination and the Consolidated Omnibus Budget Reconciliation Act (COBRA).
3. It streamlines hiring and onboarding employees.
Effective recruitment and onboarding can make a big difference in your business’s success. An HRO can streamline your recruiting, hiring and onboarding processes to ensure you hire the best members for your team. HROs help you not only acquire the right employees but also onboard them in a way that complies with labor and employment laws. For example, your HRO can help you distribute the necessary new-hire documents, obtain the required signatures and file the documents securely.
If your company hires immigrants, you can benefit from an HR outsourcing service that is well-versed in international employment laws and has experience with the foreign worker hiring process. Immigration compliance at both the state and federal levels is a complicated process that your own HR staff may not have expertise in. HROs help protect your company and immigrant workers from unintended and potentially costly violations of immigration law.
4. It provides expert HR insight and support.
Managing every HR task for your team is a big feat, even in a small business. Without an entire department to manage and track your HR needs, there is a good chance you will need to hire a service like an HRO to help you. Even if you have an internal HR manager, they can benefit from a helping hand and additional expertise. An HRO can help you meet all your company’s HR needs, even if you’re on a tight budget.
5. It is a scalable HR solution.
Although some HROs offer bundled plans, others allow you to create unique service plans with a la carte HR features. This flexibility is convenient for any business but especially for growing organizations that need their HR support to expand as they scale up. Instead of being limited by your HR capabilities, you can add and remove HR services as soon as they apply (or don’t apply) to your organization.