What Is Human Resources Outsourcing? – A Complete Guide

Outsourcing your Human Resources may be one of the most important management decisions you will make this year. As you expand your business in Europe, you need knowledgeable support. Utilizing an outside HR consultant or manager can help you to optimize your global HR function with a European virtual HR expert.

HR outsourcing is the process of contracting with an outside vendor to manage all of your human resources tasks. The goal of outsourcing is to ensure that all of your HR processes are streamlined, well-managed, and efficient.

The biggest benefits of international HR outsourcing solutions? It’s that you get to focus on the important work of running your business and increasing revenue, rather than worrying about things like compensation, payroll, job training, and recruitment.

You may also see significant cost reduction through HR outsourcing as you can hire on a contractual basis and won’t have to worry about recruiting talent for an entire inhouse HR department.

HR Manager conducting and interviewImage from Canva

Human Resources Outsourcing: The Basics

There are a number of contract options for outsourcing your HR, including:

  • Annual contract
  • Multi-year contract
  • Interim HR services
  • Short-term contract
  • Services available on retainer
  • Project-based contract

Many companies choose to sign an annual or multi-year contract with an HR company. Representatives from the HR company will then take over most or all of the business’s day-to-day HR responsibilities.

Some will also choose to go the outsourcing route as a temporary solution to an urgent need.

Your newly-contracted HR manager can come to your workplace to conduct business on-site for a number of predetermined days per month or conduct all work remotely.

This is an ideal solution for companies that have grown quickly and need more HR support but aren’t interested in hiring a full-time Human Resources department.

Although there are costs associated with outsourcing your human resources, these costs are much lower than hiring a full-time HR manager or an entire HR department.

Your outsourced HR manager will take over as many of the tasks as you want them to. If you feel really connected with one particular HR task, you can always ask for a contract that allows you to continue to do that work, while the HR rep takes over everything else.

What can your outsourced HR manager do?

Your HR representative can do everything an in-house HR manager can do, but with a much smaller line in your budget.

Some of the responsibilities that you can assign to your HR rep include:

  • Setting up payroll (including with local and international partners)
  • Managing your company’s HR help desk (via email)
  • Setting up benefits schemes that align with local laws in any country where you have employees or contractors
  • Writing employee handbooks, policy overviews, and procedural guides
  • Managing personnel administration tasks
  • Screening and assessing job candidates
  • Onboarding new employees
  • Ensuring that employment contracts are clear and on file
  • Analyzing gaps in your training procedures
  • Conducting training for all or some of your employees
  • Improving your business performance
  • Taking care of employment terminations, severances, and retirements

Benefits of HR Outsourcing

The benefits to outsourcing your HR are plentiful.

Take a moment and imagine what it would look like if those tasks listed above were suddenly taken off your list of responsibilities. What a relief!

Next, think about how much more work you could get done if you didn’t also have to tackle those human resource tasks. HR outsourcing for small business growth can be a pivotal step toward expanding your business and alleviating your stress. Not only would you be less stressed, but you would also be able to do more of the work that is important to you.

When your HR tasks are managed by an experienced professional HR consultant, you can dedicate more time to the work that makes your company successful. HR is an essential part of your business, but it doesn’t have to take up so much of your mental energy, your time, or your budget. Understanding the benefits of outsourcing international HR can help you to make an informed choice.

3 key advantages of hiring an HR company

At Europe HR Outsourcing Solutions, we work with companies across numerous industries, throughout Europe. Our clients trust us to manage their staffing, payroll, and employee management work.

During our years in the HR industry, we have learned what an HR company needs to offer if we are going to stand out from the competition. This is what you should expect from your HR vendor:

  • Expect Speed. Your HR representative should be able to answer your questions quickly (in 24 hours or less). Before you sign a contract with an HR company, find out how long it will take for them to reply to your questions, concerns, or needs.
  • Expect Immediate Operationality and Exceptional Quality. Highly qualified HR consultants bring years of expertise to their work. There should not be any time gap between when you hire your HR team and when they get you up and running.
  • Expect Flexibility. HR companies with rigid policies and inflexible contracts are simply not going to serve their clients well. Your HR consultant should be able to serve you in any number of frameworks, including: ad hoc, interim, project-based, retainer-based, short-term, and long-term. Contracts should be adaptable to the unique needs of every individual business.

You don’t have to contract with countless vendors.

One additional benefit of outsourcing your own dedicated HR team is that you don’t have to hire multiple vendors. Instead of negotiating countless contracts with various service providers, you can hire a team that manages the work of multiple vendors, including:

  • Benefits consultants
  • Payroll vendors
  • Recruiters
  • Corporate and labor lawyers

Special Circumstances That Need Additional HR Support

In addition to the basic HR tasks that come with running a company, there are also circumstances in which special considerations need to be made.

Here are some examples:

  • Businesses that hire internationally or have employees across multiple countries
  • Small, new businesses that have to start from scratch
  • Businesses that have grown rapidly and need to scale up their HR departments
  • Very large businesses with failing, under-qualified, and likely expensive HR departments
  • A business has too many open positions, including difficult-to-fill openings
  • A company lacks clear and effective policies and procedures, causing confusion among executives and all other employee
  • Companies that are going to expand to Europe
  • Companies that are preparing for acquisition

Europe HR Solutions – Outsourcing HR Solutions for International Businesses

When you run an international organization, HR just gets more and more complicated. You need to have someone you can trust who understands the legal complexities of each country where your business operates.

Europe HR Solutions offers a cost-effective solution for all of your international HR concerns. We have been in business for more than 20 years, solving problems and creating solutions for European and international companies.

We pride ourselves in answering your questions quickly and effectively! We help both small and mid-sized companies who are already established in Europe or are planning to start doing business in Europe.

Contact us today for a free consultation.

Business owner surrounded by paperwork, indicating the need for HR outsourcing

How outsourcing HR can save money

If you own a small or mid-sized business, you understand how frustrating it can be to spend time and money on tasks that don’t generate revenue. The costs of building an HR department from the ground up can prove astronomical. 

When you’re launching your small business in a foreign country, especially, you’ll need HR solutions before you open your doors for daily operation. Europe HR Solutions can help.

 

The right outsourced HR team can reduce your ongoing costs in the following ways:

  • Payroll administration:

By outsourcing your HR, you can bring in vetted professionals to set up and administer your payroll system. This team can train you to ensure a seamless transition after their service contract is completed. 

You won’t have to stress over hiring long-term employees to take care of payroll, or training payroll administrators.

  • Benefits implementation:

Your outsourced HR team can help you to select the right benefits software package and enroll the employees of your small business.

  • Human resources management:

Outsourcing your HR can prove to be a game changer for your overall human resources management, too. HR consultants contribute through a wealth of experience in compliance, employee relations, and recruitment.

This saves valuable time for small business owners, mitigates the risk of legal issues and delays in operations, and provides access to the latest industry best practices and trends.

When it makes sense to outsource HR for small businesses  

International companies with fewer than 50 employees are considered small businesses, and rarely expand to Europe with an inhouse HR team already in place.

For US and UK-based small businesses that launch European operations, there’s usually a CFO who oversees broad HR tasks. 

However, the CFO or other executives managing HR for a small business launch in Europe often lacks the country-specific legal and HR expertise necessary to ensure innovative solutions that reflect the country’s best HR practices and legal compliance.

It’s important to consider the following when determining whether or not you should outsource your HR:

  • What specific HR services and support does your business require?
  • Do you have anyone on your team who’s well-versed in country-specific employee regulations and labor laws?
  • Will you need management compliance training and support?
  • Will your current employment handbook, policies, and procedures translate to adhere to the needs of employees in different countries?
  • Do you have a small HR department in place that may need help implementing payroll, benefits, training, and development?
Time is money. Outsourcing HR saves time, letting you focus on what matters.

What to expect with Europe HR Solutions

By outsourcing your HR, you may find it’s easier to take care of your daily operations and to strategize and prepare for the launch of your small business in Europe. Europe HR Solutions has supported countless small, mid, and large-sized businesses in their international HR needs.  

Whether you need our team to manage your HR and implement solutions, or you need us to help guide the HR professionals you have on staff, we can sweat the small stuff to ensure your big picture remains intact. 

You can expect Europe HR Solutions to do the following:

Act as your representatives:

We’ll act as an extension of your small business. This means we will collaborate with you and ensure we’re promoting your vision and standards in any HR matters we handle for you.

Ad hoc requests:

We understand that you may have ad hoc requests. We’re used to fast-paced, high pressure situations, and will ensure your needs are met in a timely manner.

Assist with HR strategies:

We’re committed to providing HR services that help your business grow and succeed. We’ll make certain that the innovative solutions we offer adhere to your overall business and HR strategies.

Create and implement policies and procedures:

We’ll strategize with you to create and implement your company’s policies and procedures and ensure details are in place that will help your employees thrive and create a positive work environment.

Handle employee contract needs:

We’ll help to create and manage your employee hiring processes (including talent acquisition, interviews, and onboarding checklists), employee complaint procedures, performance reviews, and off-boarding processes.

Legal compliance:

Europe HR Solutions will use our thorough knowledge of the various nuances in employment regulations and labor laws to keep your operations, policies, and procedures within legal compliance. This will help reduce your liability risk should issues with employees arise.

Manage employee and management training and development: 

We can cover government-mandated and specific position training programs to support your employees to work with excellence and grow in their positions. This includes compliance training for managers.

Recruitment: 

We can utilize the latest in talent acquisition trends and industry best practices to make sure you attract the talent you deserve to fill your staffing needs. We want to help you to build the best team possible to create a positive work culture and  a productive team.

The cost of outsourced HR services for small businesses

When to outsource your small business’s HR could be determined by your available budget. The cost of outsourcing your HR may be an upfront expense, but in the long run, it can save you significant money and protect your revenue.

The services offered by Europe HR Solutions can vary in cost, and are dependent on the extent of service you require. We can determine the cost based on the scope of the project.

For example, you may need us to manage a specific, well-defined project that allows us to estimate the cost involved. However, you may require our services on a daily basis, for an extended period of time, or find you need support in an immediate HR emergency. This may mean we will need a retainer payment or charge for an hourly rate.

How to determine your HR outsourcing needs

Before you decide to outsource your HR, it’s vital to determine what type of services you require. It can be overwhelming to discern your needs, but reflecting on and strategizing about specifics can be beneficial.

Answering the following questions may help you to understand what services you require:

  • Do you need an outsourced HR professional who takes the time to know and understand your business, staff, and culture?
  • Do you need HR professionals who are available on a daily basis?
  • Are you in dire need of help with critical talent acquisition?
  • Do you require flexibility and a large scope of HR tasks?
  • Are your needs limited to legal compliance and knowledge?
  • Do you need help developing your workplace culture?
  • Do you need to overcome language barriers?
  • What are your long-term HR needs?

Other benefits of outsourcing your HR

Once you’ve determined when to outsource HR for your small business, you may find that it allows you to streamline your operations and focus on your overall business strategy.

This strategic move reduces your administrative burdens of managing payroll, benefits, and other HR tasks in-house. The cost-effectiveness of outsourcing becomes evident as it eliminates the need for investing in HR infrastructure and ongoing training. 

This newfound flexibility can enable your small business to adapt quickly to market changes and allocate resources more efficiently. Ultimately, an outsourced HR team becomes a strategic partner, and empowers you to prioritize your employees, enhance organizational efficiency, and thrive in the competitive European business landscape.

Contact Europe HR Solutions

Europe HR Solutions understands how crucial HR is to the foundation of any successful business. We can consult with you to determine when it’s best to outsource HR for your small business, and customize innovative solutions with you. 

Your HR needs remain our greatest priority, and we want to support you in ways that promote legal compliance and allow you to see your small business dreams come to fruition. 

Connect with Europe HR Solutions today for a free consultation and be sure to check out our blog for the latest HR insights, tips, and trends. The road to success for your small business is just an HR step away.

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    Author

    Inez Vermeulen

    Inez Vermeulen

    Inez Vermeulen is the Founder and CEO of Europe HR Solutions, with over 25 years of successful corporate and entrepreneurial experience in various global industries. She has helped grow and expand the European divisions of global companies such as Coca-Cola Company, Regus, DHL, American Medical Systems, etc. Inez has received several company awards for her entrepreneurial spirit and success.

    She owns a Bachelor’s degree in French, History and Latin, several HR global expert certifications, a Master’s degree in Metaphysical Sciences, ICF Coach Certification and has completed her Doctorate on Transformational Leadership. Inez is fluent in Dutch, English, French, Italian and German. She works in partnership with an extensive international network of independent & professional companies and resides in Belgium near Brussels with her husband Jan.