The Pro’s and Cons of Hiring your own HR Department 

Human Resources is often a part of business that many smaller companies parcel out to other employees. Perhaps an office manager or administrative employee takes on these additional duties.  When businesses are small with relatively few employees, this may make sense as the workload is not heavy enough to justify a full time dedicated HR person.

When the business grows, HR functions may become too much for a manager or administrative employee to continue to do in an effective way.  This is the time when companies have to weigh the options of hiring a full time HR person or outsourcing the function entirely.  It’s important to understand the pro’s and cons of both.

With internal HR, employees may have greater accessibility to HR.  This can shorten the time it takes to get questions and issues resolved.  Internal HR may also have a greater understanding of the culture and internal workings of a business over time, leading to greater customer service and better program design.

However, hiring an internal HR person also comes with some drawbacks.  Costs can certainly be a factor. 

Putting someone on your payroll costs you:

• Salary

• Payroll taxes

• Benefits

• Office space

• Training

• Equipment.

Outsourcing may be a less expensive option.  Limited expertise is another potential drawback.  With a team of outsourced HR professionals, the business may reap the benefits of a greater understanding of things like labor laws, payroll compliance, compensation and performance management, and training and development.

With the right outsourced HR provider, employees would have access to a team of professionals dedicated solely on being a resource for policy and procedure development, payroll and benefit issues, and legal and regulatory compliance matters.  Over time, a strong relationship can develop between the outsourced HR provider and the business and its employees.  This can certainly give employees the feel of having an internal HR department without the costs and limitations associated with an internal HR professional.

It’s important to weigh both options and decide what is right for your business.  Evaluating costs and spending time speaking with HR outsourcing providers can help you make the best decision for your company and its employees. LUXA Enterprises has proven to be Tulsa HR experts in the business community. Give us a call for a no obligation consultation to see if we are a good fit for your organization.

FutUndBeidl via photopin cc” target=”_blank”>Photo Credit