What is the cost of HR support - and do I need it?

What is the Cost of HR support?

When a business starts up you generally find that the owner has to take on all roles in the business including HR.

As the business grows and more employees are taken on, quite often the HR function is delegated to another employee alongside their usual duties and is not trained in HR procedures or employment law.

As the number of employees grows, the businesses HR needs will increase. There are likely to be more absences, dismissals, disciplinaries, grievances and many more issues in between. The person you have chosen to be your designated HR person may also be busier in their usual role and may not have time to look into and deal with every issue that arises.

If that sounds familiar, its time to consider your HR support options.

Quite often HR is seen as a cost centre, however, the HR function is in fact one of your most valuable departments. Good HR management will improve employee attendance, employee satisfaction, presenteeism and employee retention and all this will lead to increased productivity. Millions of pounds are lost every year to sickness absence, recruitment costs and tribunal claims which can all be managed and reduced by a trained and experienced HR function.

There are a number of options available when considering HR support:

Independent HR Consultants

Independent HR Consultants will generally work on an hourly basis and can provide support as and when you require it. They can just provide advice or can work in your business for short periods.

There is no minimum qualification or training for HR Consultants so you should check qualifications, experience, references and reviews before engaging an individual.

Every Consultant will work differently, and you should find someone who will fit in with the ethos and culture of your business. Cost varies from £50 per hour to over £100 per hour depending on experience. The big benefit is that they can dip in and out as and when you need them but the downside is that they may not be able to offer all the support you need such as employment law advice in respect of dismissals and tribunal claims. They will also work for other businesses and may not be available when you need them.

HR Retainer Packages

An HR retainer package is an external HR service that you pay a monthly or yearly fee to subscribe to. They are offered by HR Consultants and HR businesses but also by Employment Law Solicitors and Specialists.

What you get for your money and how much you pay varies greatly. You could obtain a relatively cheap package for less then £100 per month but this may only provide you with limited advice and off the shelf template letters and documents. If you would like tailored contracts of employment and handbooks, assistance with letter drafting as well as legal advice and support this may increase your costs.

Assessing your HR needs is important to ensure that you are paying for the right level of service. Larger HR and Employment Law providers may offer cheaper rates but may not provide you with the personal level of service you are expecting.

More bespoke personal services will provide greater levels of support and advice but can also be more costly. You should always look at reviews and recommendations before signing a contract which may tie you in for a number of years and be difficult to get out of if you change your mind. HR retainer packages are a great starting point for growing businesses or small to medium-sized businesses that just need some additional support.

Comprehensive HR Support

This could include hiring an experienced HR advisor to work in your business on a full-time or part-time basis or it could be outsourcing your HR department to an external provider who handles all aspects of HR for you. Both of these are the most expensive options but can free up both your time and/or other staff members who have been delegated the task.

Most larger businesses require in-house support or the support of an HR department to run effectively. An HR Consultant or HR retainer package will both require someone within your business to deliver the HR function whilst an HR department will do this all for you. You should expect to pay over £1000 a month for this level of service.

Other things to consider

These are only a few of the options available and you could also consider HR software which can help you records holidays, monitor absences and store and manage documents.

Good HR management will improve business profitability and ensure that your business grows safely and within the law but selecting the right option can be tricky. Evaluate your business needs, do your research, ask for recommendations and always read reviews before entering into any binding contract.

When thinking about the cost of HR support, remember to seek out experts who you can relate to and who understand your business – they will become an essential partner to your business needs and you should seek stability in the relationship!

Blunt thinking advice on the cost of HR support from Yorkshire Powerhouse

Have you any questions?

Here at Yorkshire Powerhouse, we’re happy to help as much as possible – is there anything else we can do to help you, do you have any further questions or can we help introduce you to an expert – please let us know:

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