HR Outsourcing: Is it Right For Your Business?

It’s a celebratory time when your business and team has grown... and also a hectic one. During periods of growth, maximizing efficient working time and scaling business practices are crucial.

For many, the decision to outsource HR is a way to save time and headaches. But is it financially worth it for your company? Here are three major aspects to consider before you decide if an outsourced HR service is right for your small business.

Review Organizational & Admin Priorities

As your company evolves, so do your priorities. What once felt manageable may now feel time-consuming or risky.

Research has shown that employees spend a significant portion of their time on tasks that could be handled more efficiently through automation or specialized support.

Ask yourself:

• How much time is your team spending on HR-related tasks?

• Which responsibilities are pulling leaders away from strategic work?

• Are compliance risks increasing as you grow?

Common HR responsibilities may include:

• Onboarding and offboarding

• Payroll administration

• Benefits administration

• Employment-related compliance support

• Professional development

• Benefits and perks coordination

And calculating the value of those services doesn’t stop at hours spent multiplied by hourly wages. Factor in which business development opportunities could be pursued in that time, as well as how much you’re willing to spend on HR administration.

Look to Automate

New software services now automate paperwork and administrative tasks that once took manual labor and a painstaking amount of time.

According to research conducted by Total Jobs, HR professionals spend about 15% of their time on administrative work and operations management alone.

Kissflow's customer research(opens in a new tab) indicates these are tasks HR managers want to automate:

• Leave requests - Sick leave, PTO, parental leave — the list goes on. Even if you have an unlimited vacation policy, it’s a good idea to still document it. There comes a point when keeping it all in a spreadsheet becomes too clunky.

• Time sheet tracking - Sorting out time sheets and keeping track of hours can take more time than it’s worth. An automated service that easily tracks and documents the hours employees worked will make your life easier.

• Staff information systems - Keeping a directory of employees' addresses, numbers, job titles, bank accounts, and personal emergency information gets complicated quickly as a team scales. Seek out software that allows employees to edit their own information, without the middleman.

Finding a place to update and file hundreds of forms, particular to each of your employees and your company, is no easy feat. Going paperless makes it easier for departments to communicate much-needed information across all verticals.

Use a PEO like Justworks for HR Consulting

One of the most overlooked and most valuable criteria is access to certified HR consultants.

As your business grows, questions arise that software alone can’t answer:

• How should we handle sensitive employee situations?

• What’s the right approach to policy updates?

• How do we navigate evolving employment regulations?

• What’s best practice for managing performance concerns?

Having access to certified HR consultants means you can get thoughtful, real-time guidance without hiring additional internal headcount.

Justworks PEO includes access to certified HR consultants as part of the service — giving you strategic HR support built directly into your platform.

Prioritize Compliance & Bundle HR Tasks

If your company has grown to 50 employees, or is on target to reach that point, regulations and compliance standards continually evolve. New compliance means new paperwork as well.

• Benefits - Medical, dental, vision, and 401(k)s all come with mounds of paperwork and are tailored specifically to each employee.

•  State Hiring Laws - If you’re expanding into different states, there are a host of state and local laws to consider, such as I-9 forms, commuter benefits, state income tax requirements, and disability insurance.

• The Family Medical Leave Act (FMLA) - Companies with 50 employees or more are required to provide at least 12 workweeks of parental leave for parents of newborn and adopted children.

• The Affordable Care Act (ACA) - The ACA regulates healthcare provider rules for employers depending on your number of employees. It also comes with tax penalties, credits, and paperwork — like the 1095-B, 1095-C, and 1094-C.

Justworks Helps with HR Consulting

HR outsourcing isn’t just about saving time, but it’s about reducing risk, increasing operational clarity, and giving your leaders the confidence to grow.

With Justworks PEO, you get payroll, benefits, HR tools, compliance support, and access to certified HR consultants, all in one platform designed to grow with your business. Learn how to get started with Justworks.