The benefits of outsourcing your HR

The benefits of outsourcing your HR

With today’s emphasis on company culture and loyalty, the role of human resources management and the types of benefits a company offers has become increasingly important for a business’s future.

However, being competitive in these areas isn’t always easy for small and medium-sized businesses. Smaller companies often don’t have the budgets to support the necessary personnel, and sometimes HR issues can be so thorny, it takes experts to navigate them successfully.

But, in many cases, even if a business is able to staff an HR department, it’s not always considered the best allocation of resources. If money can be saved using some form of outsourced HR, more funds will be available to invest in core activities—areas that will, in the long run, fuel success.

From payroll and human resource management to benefits and compensation, managers and directors can spend a significant proportion of their day engaged in these necessary but time consuming tasks. We would like to highlight the top ten benefits of outsourcing your HR and how it could improve your company.

Cost Savings

Outsourcing helps to reduce the non-revenue and office taxes generated by the organisation. A fully functional and highly developed human resource department would require a large and developed infrastructure and a large amount of skilled employees.

A small business organisation where the budget is limited, prefers to outsource HR employees rather than building and maintaining for a large group of people and to meet the needs of another department at the same time. This can save a lot of money for the company both in terms of infrastructure and in terms of maintaining a large employee pool.


Maintaining an efficient and productive workplace is critical. Advanced human resource technology developed by deployed individuals, employees and providers helps to focus on other human resource functions such as payroll, benefit administration and acquiescence and consent management.

Outsourcing helps the employees, supervisors and managers focus less on the paperwork and rather helps them to be more focussed and concentrated on how to improve the quality, efficiency and effectiveness of the workforce.

Once you begin to outsource from an organisation the employees become more efficient and the HR administration becomes more professional in their work. They also use highly advanced technology and devices to make the organisation more organised and productive.

Employment Law Issues

The workplace is full of employee and employment law issues that if wrongly handled could potentially result in costly and lengthy legal disputes and claims. Outsourcing your HR needs provides a valued  service, enabling  you to quickly deal with contracts, a tricky employee, or even a full-on crisis — and move on to build a positive, professional, productive team.

Software Solutions

Outsourcing your software solutions gives a greater understanding of the problems which organisations face in a busy,fast-paced and ever-changing business environment. For many companies, handling employee data and meeting the needs of staff, regulators and the business has become an increasingly complex task. Different functions, such as payroll, performance management and leave and absence management each produce different data sets, and the systems or external providers which process them require information in varying formats. These complex tasks which all sized businesses face can be combated with expertise advise and software knowledge.

Training Sessions

Invaluable in allowing your company to identify employees and managers training needs and identify the gaps in employees skills.  Training sessions can be offered to enhance and promote employees skills, therefore assuring that the company is constantly evolving and keeping up with current issues and trends. Developing talent to staff ever-changing company needs will ensure the company is at its most productive and efficient.

Focus on Core Business

Whether or not a company has a dedicated recruiter or some kind of recruiting function, most are not in the recruiting industry. Any recruiting tasks and activities will be outside of the core business functions and take resources from core business operations. When the recruiting process is outsourced to recruiting specialists, it doesn’t take anything away from core business activities and enables employers to find the talent they need without distractions from business operations.

Human resources staff with recruiting responsibilities can quickly become overwhelmed with recruiting volume and unable to focus on their core HR responsibilities. When this happens, it can have a ripple effect, interfering with human resources productivity and workflows and their ability to provide service for benefits, payroll, compliance, and employee programs.

A High Turnover Rate

High turnover costs money in lost and interrupted productivity, lower customer service, and lower employee engagement. But turnover may have less to do with recruiting staff abilities or compensation and more to do with the recruiting function. Companies can address high turnover when they outsource recruiting to get better qualified candidates, and a better recruiting process from experienced, dedicated recruiters. Companies enjoy higher quality hires of candidates who are vetted and well-matched to the company’s openings and culture. When ongoing high turnover starts to strain a company’s resources, the decision to outsource can be a quicker, cheaper way to stop recruiting-related turnover.

Enhanced Employment Brand

The employment brand is essentially the identity of the company as an employer, and when every other aspect of the recruiting process is in place and doing well, the employment brand improves. If your candidate quality improves, that only looks good to other potential candidates for your organization. If your hiring managers are satisfied and are working in a consistent recruit-to-hire process, then people who go through that process will only have good things to say about it and your company as an employer. Overall, outsourcing your HR helps the company in many more ways that just cutting recruiting costs or filling positions faster. Outsourcing can actually help a business become a better place to work.

Lower Employee Turnover

One of the biggest complaints employees have about their companies’ hiring policies is that they don’t do a good enough job of weeding out unqualified or unmotivated candidates. There’s nothing more frustrating for employees or managers alike than to spend days (or weeks) training a new employee only to have them quit or be terminated before they’re even eligible for benefits. High rates of new employee turnover have a negative impact on both productivity and profitability. Outsourcing recruiting to a team of experts results in better candidates, which in turn results in lower employee turnover.

Improved Growth and Competitive Advantage

External recruitment agencies with dedicated and knowledgeable resources, better recruiting technology, and with advanced social recruiting methodologies can meet with the fluctuating business growth patterns of the companies.  Small corporations and start-ups that don’t have similar expertise resources, as their larger competitors will have become somewhat relaxed after they outsource recruiting.  A recruiting firm will quickly support smaller or new corporations with required expertise candidates to build their company with key employees and even sustain with additional resources.


Seasonal demands, new projects, and new processes can create urgent hiring needs. Organizations can quickly find themselves understaffed which can lead to a number of costly consequences, including lost revenue due to lower production, excess overtime, and low staff morale. Outsourcing HR provides scalability to manage inevitable peaks and valleys in recruitment activity. It gives you access to the right talent precisely when you need it. This scalability also allows businesses to convert the fixed cost of in-house recruiting to a variable cost that adjusts as needed.


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Picture of Sandra Berns

Sandra Berns

Centric HR was founded by Sandra Berns, a confident and versatile Human Resources and Organisational Development Practitioner with 25 years demonstrable experience and a Fellow of the CIPD. Sandra has both Operational and Strategic HR expertise across Public and Private sectors and has assisted senior teams in meeting challenging workforce objectives in many corporate environments.