The selection of an outsource HR provider is often done quickly and largely due to an internal issue that a business leader feels that they need support in managing. Having called their accountant or a colleague from a networking group, they seek a recommendation and upon meeting with the HR outsourcer spend most of the time discussing the issue in hand rather than really getting to know the HR professional in front of them. Sometimes, the relationship works and the business leader and provider gel through their successful management of the initial issue, work well together on-going and the cost to the business is minimal. However, in the majority of cases, the business leader feels let down, that the provider promised the earth and never delivered, is costing them a fortune in monthly fees, to which they’ve signed up to for the next 5 years or in the worst cases, they end up facing employment tribunal proceedings or a costly settlement, because issues were managed incorrectly or the advice given by the provider has left the business at risk.
So, given the numerous HR providers in the marketplace, how can you ensure that you chose the right one, at the right time and price for you and your business? Solve an HR and Employment Law Consultancy, servicing the HR needs of SMEs across Scotland offer the following top 5 tips:
- 1. Don’t select an HR provider in distress
You may have recognised that the business could use HR support for some time, but have been putting it off or you have attended a seminar and realised that your business has some work to do to be legally compliant, when suddenly an employee issue arises that you know has the business exposed. This is the worst time to select an HR provider for all the reasons outlined above. If an issue arises where employment law support, advice and guidance is needed to resolve, consider contacting an employment solicitor who can offer you sound employment law advice, ensure that you won’t make any costly mistakes and will charge you only for their time. Once the situation is resolved, and recognising that prevention is better than cure, you can take time to focus on what you and your business need and would value in an HR provider. Do you want the solution to be low cost and hands off? Are you comfortable working from templates or would you prefer a more bespoke service? Do you want the comfort of an indemnity or would you rather be able to consider all options, their risks and make the best decision for you and your business? Do you want the HR provider to offer strategic support or just be at the other end of a phone when there’s a problem? What is your budget for HR?
- 2. Do your research
Once you know what you are looking for in a provider, now is the time to seek recommendations and explore the offerings of the many HR providers in the market. Armed with the answers to the questions you’ve asked and with an awareness of how your business operates, its vision and values, you will quickly be able to eliminate providers that don’t offer the services you require or appear not to have the same ethos as your business. Once you’ve shortlisted those that appeal, select 3 providers to meet with face to face. Any more is likely to be too time consuming and confusing, any less, could mean that you struggle to compare in terms of service and cost. Seek out providers that appear to tick as many of your boxes as possible, have case studies and recommendations from existing clients that they can share with you and are able to talk about how they achieve results
- 3. Make the face to face meeting count
Difficult as it is when you are running your own business, try to organise the face to face meetings with your shortlist at a time when you are able to concentrate on them, this will save you time and money in the long run. Be prepared to share information such as how many employees you have, what current policies do you have in place, when was the last time they were updated, have you ever been issued with employment tribunal papers and so on. This helps the provider to ensure that they offer you the best solution, at the right price to meet your needs. However, it certainly shouldn’t be all one way! Don’t be afraid to challenge the prospective providers. Questions you definitely will want to ask include How many clients do they service? Have they worked with Clients in your industry? How many employees do they have? What do they specialise in? Do they offer an indemnity policy? Do they offer face to face support, or is it mainly via telephone and e-mail ? And of course, what their contract terms are and how much do they cost?
- 4. Don’t make it all about cost
Whilst you want to ensure that you aren’t paying the earth for their services, HR providers can offer much more to a business than legal compliance. By sharing your business strategy with your prospective HR provider and asking them how HR can support the achievement of that strategy, you enter into the value adding services that your prospective provider may offer. Creating an HR strategy might sound too corporate if you are an SME, but it really means a plan for getting the best from your people, so that they can support you in achieving the aims and objectives of your business strategy. Engagement of employees, company culture, reward and recognition are some of the areas of HR that even small businesses can gain benefit from. So before selecting a provider, see what value adding services they offer and whether their packages including these services meet your needs. It’s likely even with these additions that the cost to the business would be much less than if it were to hire a full time HR professional
- 5. Be wary lengthy contracts
Many HR providers will try and tie their clients into contracts with lengthy terms and notice periods. The benefits that they may offer in return are add ons such as a full review and revamp of any contracts and employee handbook that the business may have or a lowered monthly payment. However, any provider who cannot offer you a flexible solution, even in the initial stages of your relationship may not be the type of provider that you are looking for and may in fact cost you more in the long run by not delivering. Look for a provider who will work with you in a way that meets the needs of your business, balanced by the cost. For some businesses, telephone and e-mail compliance advice is all that is required, for others a fully outsourced solution is more appropriate, however, any solution that comes with a lengthy contract term or notice period, may leave your hands tied even if things go wrong
Solve is a personal, but professional HR and Employment Law consultancy that provides value added HR Advice and Recruitment Outsourcing from our offices in Edinburgh and Glasgow.
- Hire great employees
- Manage difficult employee scenarios – disciplinaries/grievances
- Optimise employee performance and commitment
- Protect your business from employment tribunal claims
- Implement favourable contracts of employment
- Restructure for improved commercial benefit
- Manage redundancy or TUPE scenarios
- Retain and train talent