Small and medium-sized enterprises (SMEs) face the daily challenge of balancing growth, compliance, and people management, all while working with limited resources. Human Resources (HR) is often one of the most complex and time-consuming areas for SMEs to manage in-house.
Outsourcing HR functions provides a practical, commercial solution that offers flexibility, specialist expertise, and cost-efficiency. This blog post sets out the case for outsourcing HR and the key benefits and potential drawbacks, and compares the cost of outsourcing with employing an internal HR professional.
The Advantages of Outsourcing HR
1. Cost Efficiency
Hiring even a part-time, experienced HR Advisor comes with a significant cost. The minimum market rate is a minimum £17.50 per hour. Over two days a week (15 hours), this equates to approximately £1365/month or over £16,000 annually, excluding additional costs such as employer National Insurance, pension, holidays, training and development, equipment, and management time. In comparison, our outsourced packages provide access to an entire team of experienced professionals, for a lower and more predictable cost.
2. Broader Access to Expertise
We bring a team with specialist experience across a wide range of HR areas. This means your business gets the right level of support, whether it’s dealing with a tricky ER case, writing a bespoke policy, or planning a people strategy, we have “subject matter experts” to pull on.
3. Flexibility
No long-term contracts or adding permanent headcount to your monthly payroll. We offer the ability to scale support up or down depending on your business needs. You only pay for what you need, when you need it.
4. Reduced Risk
A qualified external team will do regular CPD and stay up-to-date with employment legislation and best practice, helping reduce legal and compliance risks. That CPD also includes professional support internally, as not all HR is “black and white” and using others’ views and experiences is invaluable. The final point about risk is with a HR team behind you, even if one person is away, the rest of the team are on hand when you need us!
5. More Time for You to Run Your Business
With HR taken care of, leaders and managers can focus on running the business, serving customers, and growing revenue.
The Disadvantages of Outsourcing HR (and How We Address Them)
1. Perceived Lack of Control
Some business owners worry that outsourcing means losing control. We build close working relationships and stay in regular contact to feel like part of your team, not an external agency.
2. Less Onsite Presence
We offer in-person support where required, especially during key meetings or projects. We also provide remote support via video, email, and phone, ensuring quick and easy access to help.
3. Understanding Your Culture
We take the time to get to know you, your people, and your culture. This means the advice we give is commercial, relevant, and aligned to your values and tone.
Conclusion
Outsourcing HR is a commercially sound, flexible, and effective option for SMEs. With Humber HR People, you get access to qualified professionals who deliver trusted, responsive, and tailored support. Compared to the cost and commitment of hiring in-house, outsourcing represents real value and peace of mind.
Let us help you build a stronger, compliant, and more confident business.
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