If you outsourced your human resources (HR) functions, what could you do with the time saved? The short answer: a lot!
A Professional Employer Organization (PEO) can perform HR functions, from hiring and screening to administering benefits to keeping up with applicable laws and regulations. The primary role of business is, after all, to stay in business. To do that, small businesses need to focus on their bottom line. They need to ensure that revenue is flowing in and profits are maintained and increased over time.
To do all that, small business leaders need to focus on their most important business tasks. As important as HR is, there might be multiple areas of business whose revenue potential requires your time more urgently than HR.
Outsourcing HR functions to a PEO with a company such as The Applied Companies provides significant benefits as well as freeing up your time. Here are four ways that small businesses can benefit from working with a PEO.
1. Cost savings
HR functions can cost a small business the expense of maintaining and even growing and back office functions while contributing relatively little to revenue generation. Outsourcing HR functions immediately relieves back-office expense.
In addition, HR duties can be enhanced, maintained at a certain level, or downsized with much more flexibility if the functions are outsourced – and with minimal requirement of your time!
2. Risk Management
Companies need to make sure that they follow all applicable state and Federal laws related to employment and the sector in which they do business. They also need to stay on top of rules and regulations. If they don’t, they risk fines, sanctions or even lawsuits.
In-house HR departments, especially for small businesses, may become overburdened keeping up with ever-changing laws and regulations. Outsourcing to a PEO places legal and regulatory expertise in the hands of people who focus exclusively on these issues. It minimizes the risk to small businesses, by placing the responsibility with the PEO.
3. Efficiencies in Multiple Functions
HR departments fulfill multiple functions. They handle payroll and tax withholding, if applicable. They administer benefits. They handle onboarding and process terminations. They may be responsible for all hiring functions, from job description development to postings. They may be involved in performance appraisals.
Handling all these tasks may be a tall order, especially for small business HR departments. But hiring a PEO means that you are hiring people who have expertise in all these areas. That means they can handle the areas with streamlined efficiency.
4. Employee development
Developing employees — guiding them in everything from company policies to creating promotional paths — can be very time-consuming for managers. But PEOs in HR are experts at developing employees.
PEOs can monitor employees to ensure good performance and compliance with company policies. They can develop plans to ensure that top performers progress to higher levels of responsibility.
When an employee needs to improve, PEOs can institute a performance plan. PEOs can ensure that HR proceeds smoothly while relieving managers from expenditures of time that do not produce revenue.
Get Help with Outsourced Human Resources Services in Reno
Looking for a team focused on Reno to help with HR solutions for your small business? Contact The Applied Companies today.