About Us 

Depending on the functions you are thinking you want to outsource, it can be helpful to review HR outsourcing best practices examples. These help businesses understand what services to expect and support the effort to choose the best outsourced human resources provider near you.

• Outsourcing Compliance: When choosing to outsource compliance, it is important you enter into the process with a full understanding of your legal obligations as a business. This will allow you to determine if the services provided by the vendor will fully protect you against liability. This is especially important if your state has adopted different and more strict requirements than Federal policies. Additionally, you must understand the processes and procedures the HR provider will use to document your compliance and prepare you for an audit. You should be able to check in at any time and see your alignment with industry standards, as well as be provided with a single point-of-contact who can address questions, concerns, and changes in standards as they arise.

• Outsourcing Employee Administration: Outsourcing employee administration means outsourcing a lot of the recordkeeping and information systems management that is the foundation of HR. Sometimes this means working with a SaaS provider to set up a self-service portal for employees, and the provider is responsible for the functionality, security, and maintenance of that software. This could include payroll, benefits, paid leave, and more. In other types of agreements, this extends to in-person support for employees and managers to understand and navigate company policies. This is the foundation of an HR outsourcing arrangement that gives your employees a more streamlined and simple experience. With that in mind, it’s important to make sure any software being installed integrates with other platforms you already use, and that employees will receive training in how to use the systems.

• Outsourcing Compensation and Benefits: Managing benefits and compensation is one of the most time-consuming parts of human resources that is also most closely linked to employee satisfaction. When choosing to outsource compensation and benefits administration, it’s important to understand key factors like whether or not the HR outsourcing provider helps with open enrollment, how they deliver advantages and efficiencies, and the customer service that will be available to employees. Outsourcing this function can be a big time-saver, but if it only leads to bad experiences or a sense of detachment from employees, it will not be worth the investment in the long run.

• Outsourcing Talent Acquisition: Successful HR outsourcing of talent acquisition is supporting many businesses to find talent in a competitive market. But before hiring a vendor to take on these duties and help you win a great hire, it’s important to explore how they will source talent differently. This can include defining certain roles the HR outsourcing provider will recruit for first as a “test-run” to see if they will find better candidates for your team. It’s also a good idea to define and clarify when and how your company will be involved in the vetting process, and the standards you are non-negotiable on when it comes to new hires.

• Outsourcing Performance Management: Outsourcing performance management often works best when the HR outsourcing company takes on a supporting role. In between performance reviews, the vendor can collect data and document milestones so that when the time comes, your internal team has high-level insights about how an employee has been performing. The HR outsourcing company can assist with scheduling the performance reviews in a recurring cycle and can provide training to managers about how to approach these reviews in a proactive and supportive fashion.

Overall, the best practices for outsourcing human resources boil down to establishing a clear understanding of each party’s responsibilities and having a plan for accountability. The contract should also include provisions for “insourcing,” if you decide to bring the functions back in house, as well as language about the vendor’s permissions to “re-source” your HR functions. You do not want to be surprised to learn that the HR provider has passed your administrative work or compliance documentation down the line to another company. Lastly, a final best practice of HR outsourcing is documenting the “base line” where your company is starting, so that improvements and the return on investment of HR outsourcing can be monitored and celebrated.