Outsourced HR for small businesses, why you need it?
Outsourced HR for small businesses, does it offer value for money? Many small business owners ask “What’s the point of HR, I don’t employ that many people? However, the fact is that often there is a small business HR function long before anyone has HR in their job title. Often someone in the business (usually the senior admin person) is the de facto HR Manger along with their “day job”.
Small businesses have to manage people lawfully and productively. Whatever you choose to label it, the process of managing people is HR. Small businesses that employ people have HR obligations and they need some form of HR for a small business. They have to deal with a range of administrative and compliance requirements that cannot be ignored, if they want to be lawful, and to engage their workforce.
According to the CIPD good HR management can boost productivity. They feel that there is an untapped potential to boost productivity by raising the quality of people management across all sectors, and more attention should be paid to firm-level drivers of productivity.
Managing employment law risk.
Employees in the UK have certain rights in law, and will need some form of small business HR function. Below I mention just a few:
- The right to a written statement of particulars that must contain certain information and be issued within a set time.
- The right to apply for flexible working.
- The rights to maternity, paternity, adoption and shared parental leave and pay.
- The right to time of in family emergencies.
- The right to a set amount of leave.
- The right not to be discriminated against as a result of certain of protected characteristics.
- The right to be paid a minimum or living wage.
To ensure compliance SME’s will need a suitable HR function for a small business. As well as statutory rights, employees have rights created by the contract. Whatever the employer has agreed to, either verbally, in writing or just by the way they have done things, creates contractually binding obligations of employment. The Contract of Employment gives employees rights, and places reciprocal obligations on the employer. These employer obligations exist, whether or not the employer is aware of them. Also, those employees with more than two years’ service have additional legal rights.
An outsourced HR department for small businesses is a way to meet the knowledge, skill and resource deficit most small businesses face when dealing with Employment Law matters. They often do not have the HR expertise or resources to deal with employment law and compliance issues, and will need the help of HR professionals to draft the required policies, procedures and associated correspondence. Outsourced HR for small businesses can also advise on how policies and procedures should be implemented. to ensure they don’t end up having to deal with protracted litigation or be embroiled in Employment Tribunal
Outsourced HR for small businesses can advise and support SME’s to effectively Manage Employee Records and Information
When a small business employs people it has to maintain files and records. HR Management for small businesses can help address these issues. They can ensure that employee record keeping practices and procedures comply with the Information Commissioner’s ‘Employment practices code’; they can also ensure that record keeping systems delivers the needs of the business. Some records are pretty routine employee address, emergency contacts, etc. Others records may be needed if a dispute occurs, e.g. job history, pay history, training records, driving licence checks, discipline and grievance records. Whilst other records are needed to ensure everything runs smoothly. E.G. Holiday records and administration, attendance and sickness absence records. Running an integrated and comprehensive records system can be time consuming, time that could be better utilised elsewhere in the business. Often small businesses end up with complicated and unwieldy hybrid systems of paper lists, Google or MS Office calendars, spreadsheets, etc. and WhatsApp groups. HR for small businesses can offer integrated record keeping and productivity systems.
We’re here to help
Click here to learn more about how we support businesses to effectively manage their HR. At People HR we can advise on anything from employee benefits, to company polices we also supply productivity applications or your small business. Although operating nationally, our local knowledge is based on experience in dealing with certain areas of work to help with Health and Safety at your Warrington workplace. We can also travel around small businesses in Warrington, Liverpool, Manchester and beyond to cover our training and inductions.