July 6, 2022

Business is booming, revenue is rising, and clients are happy. But with significant growth comes new challenges and responsibilities, including human resources. HR only becomes more complicated as your business grows. After all, more employees can lead to increased risk without the proper documentation, policies, and processes.

It can also take a toll on your work-life balance and mental health as a small business owner. Running your company and overseeing HR functions is a short road to burnout. But even when you and your team are maxed out, tasks like employee paperwork, payroll, and benefits administration still have to get done.

Despite exciting growth, hiring a full-time HR employee may not yet be within the budget. And even if you could afford to hire someone, chances are one person won’t have all the necessary skills or bandwidth to handle your entire organization’s HR needs. 

That’s why many small businesses choose to outsource HR functions. This is a much more cost-effective solution: You leave those time-consuming, often stressful responsibilities to a team of experts who will get things done right and on time. Your HR company can also adapt to your business’s needs and budget.

Opting for outsourced HR will protect your passion and bring you peace of mind by: 

  • Lowering financial and legal risks.
  • Fostering a positive workplace culture.
  • Removing a few HR hats from your head.

Lower Financial & Legal Risks

While you can save money by not hiring HR personnel, having none can put your company at even greater risk. 

Outsourced HR is a happy medium for many small businesses, allowing them to avoid significant financial and legal risks. An HR firm will help:

  • Prevent and protect you from employee lawsuits and costly settlements.
  • Maintain compliance with employment laws and avoid penalties.
  • Identify and resolve any potential areas of risk.

For example, all hiring and termination processes must follow labor laws, which can be time-consuming. Employees may also need training in certain areas for legal reasons and to establish a positive workplace culture. Perhaps your business is subject to specific safety training requirements. 

An HR consultant can manage all of the above. Your employees and organization will be compliant with federal and state laws, leaving you with one less thing to worry about.

Foster a Positive Workplace Culture

As your small business grows, you and your leadership team may not have time to provide one-on-one attention to every staff member. This can negatively impact morale if workers feel they don’t have anyone they can turn to about work-related issues.

Someone needs to manage functions like workplace conflicts and performance reviews. These are critical to employee retention and new talent acquisition. 

Outsourcing HR gives you a partner who will take care of these areas. You’ll know you can work ON instead of IN your business. Best of all, you’ll enjoy greater work-life balance knowing you can step away because:

  • You have a happy, productive team you trust to keep the ship afloat.
  • Your HR company will support your team as needed.

Remove a Few Hats

You already wear many hats, from Operations to Marketing to Accounting…and the list goes on. Wouldn’t it be nice if you could remove a few? You can probably feel the weight being lifted just thinking about it! 

HR projects and functions can be broken down into several specific roles, which can be a lot for a small business owner and their lean team to handle.

Recruiting & Retention

First, it’s up to the HR team to retain existing employees and attract new talent. They are responsible for: 

  • Creating programs and ways to measure employee wellbeing.
  • Ensuring compensation and benefits packages are competitive.
  • Writing clear and attractive job descriptions.
  • Having an eye and ear for who will be a good fit for your organization and culture.

Performance Management

HR must assess business performance and use that data to help the company succeed. This entails: 

  • Establishing a performance review process.
  • Guiding managers in conducting effective performance reviews and employee development.
  • Overseeing not-so-pleasant tasks like performance improvement plans (PIPs).

Succession Planning

On the note of employee performance, HR also plays an essential role in creating and maintaining leadership development and succession planning programs. These are critical to retaining and improving the skills of your top performers, who will ideally help lead the organization one day. 

Training Programs

HR should support your business in setting up training programs such as mentorships, workshops, and continued education opportunities. These programs help show employees you care about their development and goals. You will have a skilled workforce of people who want to stay with your company because they feel valued.

Change Management

No matter how long you’ve been in business, you likely understand that the only constant is change. Business is always evolving, from compliance and administrative adjustments to new tools, processes, and skills. These changes can affect both existing and future employees. 

HR must update contracts, policies, payroll and benefits administration, and other practices. Changes may require new/additional training for all or specific employees.


When workplace conflicts arise, you need a trained professional to help all parties reach a mutually beneficial resolution. Disputes can range from two employees who simply don’t get along to sexual harassment, theft, and everything in between. HR must be a neutral party who can conduct a fair and impartial investigation and even conduct terminations if necessary.

Maybe you haven’t had to deal with all these areas yet, but you will at some point — and eventually, it will be tough to balance all these HR hats on your own. Outsourcing HR, however, means you don’t have to handle everything on your own. Instead, your HR company will manage all these areas smoothly and efficiently because they have a team of experienced practitioners with diverse backgrounds.

It is possible to run a thriving business and do what you love while enjoying a work-life balance! A vital piece of this equation is knowing when to invest in the areas of your business that are outside your zone of genius. Outsourced HR is a powerful way to achieve that harmony, protect your company, and ease the burden on your existing employees.

Find out how BlueLion can relieve stress and give you the freedom to take your business to new heights when you speak with one of our HR experts at 603-818-4131 or info@bluelionllc.com.

The information on this website, including its newsletters, is not, nor is it intended to be legal advice. You should contact an attorney or HR specialist for advice on your individual situation.