FAQs of HR Outsourcing

45% of small business owners estimate they spend roughly one day per week or more on administrative HR.

Outsourcing HR is just one way to get back time but many business owners are admittedly skeptical of the process. Not to worry — here are some answers to the most common questions about HR outsourcing and how it can benefit your business.

How much will it cost?

The cost of HR outsourcing will vary depending on the size of your company, the specific services you need, and the HR Outsourcing provider you choose. However, as a general rule of thumb, you can expect to pay between 1% to 3% of your gross payroll for HR outsourcing services. Factors that influence the cost include number of employees, total payroll volume, pay frequency, employee turnover, complexity of payroll and several other factors.

The better question is – How much is Administrative HR costing you now?

Most business owners don’t realize how much they are actually spending now to manage “all things HR.” The average cost of administrative HR for companies with 1-50 employees is between 3% and 12% of gross payroll. So, if your company is currently spending 5% of its gross payroll on administrative HR, you could potentially save between $15,000 and $60,000 by outsourcing your HR functions.

Of course, there are other factors to consider besides cost, such as the quality of service, the level of expertise, and the flexibility of the provider. But if you’re looking for a way to save money and improve your HR processes, HR outsourcing is a great option to consider.

I’ve had bad experiences switching payroll providers in the past. How will the switch to Focus HR be any different?

Focus HR has a team of experienced professionals who are dedicated to making the switch as smooth as possible for you and your employees. We have a simple 5-step onboarding process (Learn more here) that will walk you through each step of the transition, and we will work with you to transfer all of your employee data, ensuring that your paychecks are accurate and on time. We also provide local, responsive support to help our clients navigate each step of the way.

Furthermore, we have built our business out of transferring clients from one provider to another, and approximately 80-90% of our clients come from other providers. This is a testament to our commitment to providing a smooth and seamless transition for our clients.

How much lead time do you need to switch from my current provider?

We typically need 3-4 weeks in advance of the first check date that we’ll be processing your payroll. This will give us enough time to gather all of your employee data and ensure that the switch is smooth and seamless.

If you need to switch sooner, we may be able to accommodate you, but we recommend giving us as much lead time as possible.

We understand that switching payroll providers can be a daunting task, but we’re here to make it as easy as possible for you. We’ll work with you every step of the way to ensure that the switch is a success. Learn more about our simple 5-Step Onboarding Process.

Is my business large enough?

Focus HR doesn’t have a minimum employee requirement. We work with businesses of all sizes, from startups with just a few employees to larger businesses with hundreds of employees.

We understand that every business is different, and we’re here to customize our services to meet your specific needs. We’ll work with you to develop a plan that’s right for your business, regardless of size.

If you’re not sure if Focus HR is right for you, we encourage you to contact us for a free consultation. We’ll be happy to answer any of your questions and help you decide if our services are a good fit for your business.

How much time is this going to take to know if HR Outsourcing makes sense for my business?

During the initial discovery meeting, we’ll discuss your business needs and goals, and we’ll answer any questions you have about HR outsourcing. We’ll also gather some documents from you, such as your payroll records.

First, the cost of HR outsourcing can vary depending on the provider and the services you need. It’s possible that you could save money by switching to a different provider.

Second, HR outsourcing providers can offer a wider range of services than you might be able to provide in-house. This could include things like benefits administration, payroll processing, and employee training.

We understand that time is valuable, so we’ll do our best to make the evaluation process as quick and easy as possible.

I feel like I’m getting a good deal now – why should I change or even take the time to investigate?

There are a few reasons why you might want to consider changing HR providers even if you’re happy with your current one.

First, the cost of HR outsourcing can vary depending on the provider and the services you need. It’s possible that you could save money by switching to a different provider.

Third, HR outsourcing providers can free up your time so you can focus on other aspects of your business. This could lead to increased productivity and profitability.

If you’re considering making a change, we encourage you to contact us for a free consultation. We’ll be happy to discuss your specific needs and help you decide if switching providers is right for you.

What’s the big deal anyway. I just handle HR myself (or have one of my office staff handle it)?

Can you do HR yourself? Sure! The better question, however, is SHOULD YOU handle HR yourself?

HR is a complex and ever-changing field. There are numerous laws and regulations that you need to be aware of, and you need to be able to make quick decisions that can have a big impact on your employees.

If you don’t have the time or expertise to handle HR yourself, then you should consider outsourcing it to a professional. This will free up your time so you can focus on other aspects of your business, and you’ll have the peace of mind knowing that your HR needs are being taken care of by experts.

Employees are your greatest variable and risk. They are the ones who make your business run, and they are also the ones who can cause the greatest grief. If you don’t have a good HR system in place, you are likely leaving yourself open to significant risk exposure.

Here are some of the risks of handling HR yourself:

Compliance violations: If you don’t know the latest employment laws, you could be setting yourself up for fines or even legal action.
Employee dissatisfaction: If you don’t handle HR issues properly, your employees could become dissatisfied and leave your company.
Increased costs: If you make mistakes in HR, it could lead to increased costs in the form of legal fees, severance pay, or lost productivity.

If you’re serious about growing your business, then you need to take HR seriously. Outsourcing HR to a professional can help you protect your business and your employees.

How much can outsourcing HR save my business?

The average annual ROI of using a PEO is 27.2%. This means that for every $100 you spend on PEO services, you can expect to save $27.20.

There are a number of ways that PEOs can save you money, including:

Savings on employee benefits: PEOs can negotiate better rates on employee benefits, such as health insurance and retirement plans.
Reduction in workers’ compensation premiums: PEOs can help you reduce your workers’ compensation premiums by identifying and addressing potential hazards in your workplace.
Improved compliance: PEOs can help you stay compliant with employment laws, which can save you money in the long run.
Freed-up time: By outsourcing HR to a PEO, you can free up your time to focus on other aspects of your business.

Of course, the amount of money you save will depend on the specific services you need and the size of your business. However, even small businesses can see significant savings by outsourcing HR.

Here are some additional stats about the cost savings of outsourcing HR:

Expected annual median revenue growth for PEO clients is 40% greater than comparable non-PEO firms.
69% of PEO users reported growth in 2020 versus 28% of non-PEO users.
Businesses partnering with a PEO are 82% more likely to be operating normally in spite of the pandemic.

How much time can HRO save me?

According to research, about 45% of small businesses spend almost an entire day per week or more on administrative HR issues. That means HR outsourcing could save you up to 8 hours per week.

Outsourcing HR can save you a significant amount of time, allowing you to focus on other aspects of your business.

Here are some additional benefits of outsourcing HR:

Reduced stress: Outsourcing HR can help you reduce stress by taking care of the administrative tasks that you don’t have time for.
Improved accuracy: Outsourcing HR can help you improve the accuracy of your HR processes by ensuring that they are compliant with employment laws.
Increased peace of mind: Outsourcing HR can give you peace of mind knowing that your HR needs are being taken care of by experts.

If you’re looking for ways to save time and improve your HR efficiency, outsourcing HR is a great option.

Here are some questions you can ask yourself to determine how much time HR outsourcing can save you:

How much time do I currently spend on administrative HR tasks?
What are the most time-consuming HR tasks for me?
How would I like to spend my time if I didn’t have to worry about administrative HR tasks?

Once you have a good understanding of how much time you spend on administrative HR tasks and what you could be doing differently to generate more value for the business, you can start to explore outsourcing HR as an option.

Why should I select Focus HR over the large payroll companies?

There are a few reasons why you might want to select Focus HR over the large payroll companies:

Personalized attention: Focus HR is a smaller, local company, which means that you’ll get more personalized attention from our team. We’ll take the time to understand your specific needs and goals, and we’ll work with you to develop a customized solution that’s right for your business.
Expertise: Our team of HR experts has years of experience in the industry. We’re up-to-date on the latest employment laws and regulations, and we’re committed to providing you with the best possible service.
Flexibility: We offer a variety of services to meet the needs of businesses of all sizes. We can customize our services to fit your specific budget and requirements.
Peace of mind: When you work with Focus HR, you can rest assured that your HR needs are being taken care of by experts. We’ll handle everything from payroll processing to benefits administration, so you can focus on running your business.

Ultimately, the best way to choose an HR services provider is to compare your options and choose the one that best meets your needs. If you’re looking for a personalized, local, and experienced HR partner, we encourage you to contact Focus HR today. We’d be happy to discuss your needs and help you determine if we’re the right fit for your business.

How Will HRO Affect My Employees?

In most cases, your employees will be thankful for HR outsourcing. For starters, they’ll receive their compensation more efficiently. Also, many HRO providers offer an employee self-service portal, giving them total visibility over their sick days, vacation time, and benefits administration.

These features will help you retain quality talent and may even help you attract new applicants.

What HR Functions Can Be Outsourced?

HRO firms can manage or help assist you with many tasks, including:

HR Consulting and Compliance
Payroll Benefits Administration
Workers’ Compensation Management
Employee Benefits Administration
401(k) Administration
Employee Onboarding
Training and Professional Development
Performance Management
Employee inquiries and support
Regulatory compliance

Basically, all of your current administrative HR responsibilities can be managed by an outsourced HR firm, which saves you both time and money.

What are the advantages of outsourcing all my administrative HR tasks (Payroll, Benefits, 401(k), Workers’ Comp) vs. keeping them all separate?

Having one point of contact for all of your HR needs can save you:

Time: You won’t have to spend time transferring your information between different departments or providers.
Money: You’ll only have one invoice, instead of multiple invoices for different services.
Headaches: You’ll have one person to go to for all of your HR needs, so you won’t have to worry about getting lost in the shuffle.

In addition, having one point of contact who understands your business can help to ensure that fewer mistakes are made. This person will be familiar with your company culture and your specific needs. They will be able to quickly identify and resolve any issues that arise. They will be able to provide you with personalized advice and guidance..

Here are some additional benefits of having one point of contact for all of your HR needs:

Increased communication: Having one person to communicate with can help to improve communication between you and your HR provider. This can lead to a better understanding of your needs and a more efficient service.
Better customer service: Having one person to deal with can help to ensure that you receive better customer service. This person will be familiar with your account and your needs, and they will be able to quickly resolve any issues that arise.
Less mistakes: Having one point of contact can help to enhance the security and compliance of your HR. This person will be responsible for protecting your data and ensuring that your business is compliant.