Running a business involves employing staff. Employing staff needs someone to recruit, manage and review them.
This leaves some businesses with a choice, employ a dedicated HR professional or let managers do that work too. Employing a dedicated HR professional can be costly and the size of your business may mean that you only need someone on an ad-hoc basis. But not having a HR professional can put extra strain on your team. If issues aren’t handled correctly in this field you can also leave your business open to lawsuits.
It’s not so long ago that HR departments were called ‘Personnel’. They were viewed quite suspiciously and not taken very seriously. Well, times have well and truly changed. No large company can be without a dedicated HR department. They handle a vast range of duties, including:
- Disciplinary issues
- Employment policy
Some HR Directors even sit on the Company’s Board of Directors. This means they have a direct say in the running of the business.
What Are Your HR Requirements?
Depending on the size of your business, you will have differing HR requirements with different HR salaries to consider paying.
Often smaller companies only need an administrator. An HR Administrator can earn an average salary of over £24,000 – typically these people will drive recruitment and manage employee data.
Large companies may require a full HR department consisting of:
- Several HR Officers. Whose average salaries are over £28,000
- Some HR Managers average salaries are over £38,000
- An HR Director – with an average salary of over £80,000 – making human resources a well-paid sector to work in.
If you compare the average salary of an HR worker to the average UK salary the amounts are similar. HR offers many different positions that you can start your career in, with many different career paths to follow.
In-House HR Department
If your company is medium or large, or if it is growing rapidly, it makes sense to have a dedicated HR Officer as part of your team. Your HR Officer will handle all the recruitment needs as well as ensuring you have a clear Company Handbook, suitable employment contracts and policies, and up to date employment law knowledge. This last one is especially important as employment law is constantly changing and evolving.
The more people you employ, the more complex your employee issues will be. The more employees you recruit will mean more onboarding of new staff. Then, with a larger workforce, you will need to manage and track employees time off. This can become problematic, but this can be managed with HR software.
Handling the Day-to-Day with an HR Officer
Inevitably, there will be more disputes between colleagues and more time needed to resolve issues in the workplace. Maternity pay & leave, paternity pay & leave, sick pay & leave, holiday pay… the list goes on and on. Adding these matters on top of a general manager’s work will very quickly start affecting their performance – and that of the employees they are trying to manage.
Handing the recruitment and management of employees over to an HR Officer has many benefits. It will mean that someone is always reviewing the performance of your employees and finding out where improvements need to be made. They will also keep on top of all legal matters, giving you peace of mind that everything has been done ‘by the book’.
Having an HR Professional as part of your management team will also add a new dimension to the team as they will be able to contribute strategies for long term development and growth of the business, and will be able to identify, write and implement new training procedures for employees.
Using HR Outsourcing
For smaller companies, having a dedicated HR professional simply doesn’t make sense. If you only have a handful of employees, paying the average HR salary of £36,000, is not very cost-effective. Potentially, there also wouldn’t be enough work for them to justify the annual salary costs.
Many SMEs, therefore, use HR Consultancy as a compromise. These companies recognise they need assistance with their HR requirements but don’t need someone on a full-time basis.
HR consultancy works in several ways, depending on the needs of your company. You might choose to pay a retainer to a company. This means that you pay a monthly fee to have someone at the end of the phone (sometimes 24/7) to answer any employment issues that may arise. They can also handle your recruitment and payroll requirements including contracts, employment policy and benefits. Fees for this kind of assistance can be as little as £200 per month although this depends on the number of employees and the complexities of your requirements.
If a more complex matter arises, you may need to pay more to the Consultancy.
Assistance as required from an HR Consultant
You may choose to pay for HR assistance as and when required. For example, if you are recruiting a large number of employees, you might choose to pay to have an HR Professional handle the whole process:
- Placing the job adverts
- Getting contracts signed
Fees for this level of service can be anywhere from £50 to £100 per hour and the daily cost might be in the region of £500. Whilst this might sound expensive, if it’s for a set period of time, to achieve a set objective, it’s a lot more cost-effective than having a full-time HR Officer on your payroll.
Using professionals through HR Consultancies will ensure you are getting the most up to date employment law advice. It will also grant you access to HR software and tools to manage holidays and sickness, if that’s what your company needs.
Whether you choose to employ a dedicated HR Officer, or you think using an HR Consultancy will suit your company’s needs better, having professional, trained staff to deal with your employees is imperative in any business today.
It’s so easy to get things wrong and end up with:
- Despondent employees
- A high staff turnover
- A lawsuit against your company.
Don’t underestimate the huge potential of having a good HR Professional involved with your business.