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5 Ways that Outsourcing HR can Benefit Your Business

Contributor: Evita Lara, HR Consultant

January 23rd, 2023 | 4 min. read

By Tony Calavitta

5 Ways that Outsourcing HR can Benefit Your Business

The list of HR tasks you are managing on your own has become endless – from  recruitment, onboarding, and employee relations to payroll and benefits administration to regulatory compliance, there aren’t enough hours in your equally endless days to cross every HR responsibility off.

You add your other employer responsibilities to this already overwhelming agenda.

And as each marathon day goes by, you get closer and closer to burnout though more and more of your to-dos remain undone.

You know that “something has got to give.”

Your tireless effort to do it all on your own has made one thing abundantly clear – you need help.

Here at Combined, we are here for you. Our HR experts have assisted a large number of employers in your same position, to efficiently balance business and HR management. And we are determined to help you do the same.

In this article, you will learn 5 ways that HR outsourcing can shorten your list of responsibilities while enabling you to grow and improve your business operations.

What is HR outsourcing?

HR outsourcing is bringing in a third party with specialized knowledge and training in HR operations to manage the areas of your HR that you want help with.

When outsourcing your HR, you can build a customized plan to address your specific HR needs.

Let’s say that you really enjoy the human aspect of HR and want free reign over recruitment, onboarding, and employee relations. You can outsource the technical side of HR to receive service covering payroll, benefits administration, regulatory compliance, etc.

On the other hand, if you are more comfortable with the technical side of HR, you can have a third party manage the more personal side of it.

Or maybe you want nothing to do with HR management and it is entirely outside of your wheelhouse. No problem! HR outsourcing can offer you an expansive service that extends to cover all of your HR tasks.

Outsourced HR is a personalized solution – services can take care of as little or as much as you need.

Will HR outsourcing benefit your business?

The short answer is YES! With a job as involved and complex as HR management, there are many benefits of employing specialists to lend help in their exact area of expertise.

Here are the top 5 ways that outsourcing your HR can benefit your business.

1. Outsourcing your HR will save you time

Remember that endless list of HR tasks monopolizing your calendar? Well, crumple it up, aim, and score a 3-pointer into the garbage bin. 

An immediate benefit of HR outsourcing is that you can reallocate your time to fulfill other important employer responsibilities.

By outsourcing your HR, you will have more time to focus on the core strategies that contribute to revenue, build your bottom line, and grow your business.

And with professionals handling your HR tasks, you can rest assured that every item on your former HR list is double-checked and correctly completed.

2. Outsourcing your HR will conserve your cost

Let’s say you decide, instead of outsourcing your HR, to hire someone to manage your HR in-house.

What are the immediate and ongoing costs associated with this process?

  • Cost of recruitment
  • Cost of training
  • Cost of salary
  • Cost of benefits

These costs add up quickly.

By outsourcing your HR, you eliminate these costs – you receive HR expertise without the hassle of recruitment and training and without the extension of a salary and benefits.

Granted, HR outsourcing has associated costs too. Its cost depends on factors like the extent of services you want to receive and the size of your business. But, since HR services are tailored to your company’s needs, the cost of outsourcing is scaled to match the services you require.  

This means that HR outsourcing is also tailored to your budget – in choosing the number and type of HR services you want to outsource, you decide what you spend and what you save. Because of this, HR outsourcing is a cost-effective solution to HR management problems. 

3. Outsourcing your HR will reduce your risk of HR violations

HR management is a complex and difficult task that needs constant attention – it requires knowledge and monitoring of a wide range of employment laws.

By outsourcing your HR, you give the responsibility of compliance to a professional who has an adept understanding of employment law and is specifically trained in how to follow it.

Your HR service provider will keep up with changing federal, state, and local regulations and make sure that your policies are always updated to observe them.

As a result, your business will be at low risk of HR violations.

4. Outsourcing your HR will improve internal communication 

Who can your employees speak to about HR concerns?

By outsourcing your HR, you answer this question, giving your employees a point person to communicate with so that they know all of their concerns will be heard and appropriately addressed.

Think of it like a grade school classroom – If student #1 is being bullied by student #2, who is the authority figure in the classroom that student #1 can report to? The teacher.

If your employees have an HR concern, your HR service team becomes the authority figure, like the classroom teacher, that they know they can speak with.

In the case of the classroom, the teacher will listen to student #1 and respond to the situation accordingly.

Similarly, your HR service team will acknowledge and settle any concerns your employees have. In response to this outlet for communication, your employees will feel appreciated, validated, and more secure in their roles.

5. Outsourcing your HR will encourage employee engagement

As an employer, employee retention is the key to business growth. And the key to employee retention is employee engagement.

According to a recent New York Times workforce survey, employee engagement is the highest single impact variable in employee retention, and employees who find a passion and purpose at work are more than 3 times as likely to stay with their organizations than those who don’t.

It shouldn’t be surprising then, that a highly engaged workforce can reduce a company’s turnover rate by 25-29%.

When outsourcing your HR, you can prioritize services that are designed to engage your employees.

A few examples:

For example:
  • Establishing performance recognition measures will boost employee morale.
  • Offering and incentivizing career development programs will create employee motivation.
  • Using regular surveys and feedback to improve areas of employment that are important to employees will establish a good rapport.

By placing a greater emphasis on employee needs and relations, outsourcing your HR can elevate both employee engagement and retention.

Take the next steps to benefit from HR outsourcing

Keeping up with revenue-generating responsibilities and HR-related tasks is challenging. But, you don’t have to do it all on your own.

In this article, you learned 5 ways that outsourcing your HR can benefit you, your employees, and the growth of your business.

Here at Combined, our HR experts have helped countless employers, just like you, to realize and reap the rewards of HR outsourcing. We want to help you find the perfect outsourcing answer to your business’s HR needs.

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Schedule a meeting with an HR expert!

So you can stop breaking your back doing it all on your own and start breaking business barriers with an HR outsourcing solution.

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If you are not yet ready to speak with a team member, you may find these resources helpful:


This article is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice.