Why Start-Ups Should Consider Outsourcing Their HR

December 27, 2012

What makes an entrepreneur tick? Is it that rush of creating a company from scratch? Is it the feeling that you are on the brink of the “next big thing”? Disruption! All those countless hours spent working hard and feeling fulfilled doing exactly what you love. Yet, it is likely the last thing on every  founder’s mind is Human Resources. The thought of making a comprehensive employee handbook, processing each employee’s payroll and payroll taxes, comparing and administering employee benefits plans, etc. can make any entrepreneur cringe behind their keyboards.

Why should you consider outsourcing?

Plain and simple, you can focus on what your business is good at. HR is a complicated and time consuming discipline. It requires a balance between the needs of employees, the needs of the business owners, and complete understanding of ever-changing regulations.  Would you ask a developer  to do an accountant’s job? Probably not. Investors also like the liability protection that a PEO offers.

Can’t I just hire an HR professional?

Yes you can. This HR person may  do a great job, if they know what they are doing. Yet, is recruiting and managing an HR resource a good use of time?  HR outsourcing firms or PEOs (Professional Employer Organizations) have highly trained and certified professionals that can tackle HR issues for you. If you have office staff that are filling your HR role, a PEO can work with these team members and provide consultation and guidance.

How big does my company need to be for HR regulations to become an issue?

Typically around 10-15 employees is when many companies see the complexity of having employees being a distraction and HR laws become a concern. How you hire, dismiss, train, and structure your internal procedures. Yet, getting off on the right foot early is always best.


Want to know more? Contact Tandem HR [  [email protected] ] with any questions you may have. We’re your friendly Chicago PEO and we’d love to hear from you.


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