May 12, 2022
7 Steps for Choosing the Right Outsourced HR Consultant

You know you are ready for outsourced HR. Perhaps you may already have specific HR responsibilities or projects in mind, or your team’s capacity is maxed out. Either way, it’s time to leave the human matters to the human experts. 

But how do you choose the right HR consultant? After all, you’re entrusting them with significant business concerns. Do they offer the specific services you need? Do they have experience in those areas or working with businesses like yours? 

Below, we’re reviewing seven steps you can take to hire an HR partner that will help you take your organization to the next level. They are: 

  • Assess your HR needs
  • Calculate your budget and cost
  • Research each potential HR consultant
  • Consider your growth plan
  • Determine if you need onsite support
  • Know what you’re getting
  • Make sure it’s a good fit

Read on for more tips and questions to consider as you interview prospective HR firms.

1. Assess your HR needs

Every employer’s HR needs vary based on several factors. Start by answering the following questions: 

  • Do you already have HR staff in-house? If so, what is their experience and bandwidth? 
  • How many employees do you have? 
  • What are your growth plans for the business? 
  • What HR and operational challenges do you currently face? 
  • Do you need one-off assistance or ongoing support? 

If you have a very small or nonexistent internal HR team, you might need an outsourced HR firm to manage most of your HR functions. Perhaps you just hired your first employee, but you’re new to HR and employment law. Or maybe your company is expanding more quickly than expected, and you want to ensure compliance. 

On the other hand, you might have had an HR manager or staff member recently give their notice. Now, you’re scrambling to handle their tasks, get up to speed, and hire and train their replacement. Sounds stressful, right? 

An experienced HR consultant can help any of the above organizations get their ducks in a row. BlueLion even offers a unique HR Gap Coverage to ensure nothing falls through the “gap” and your company keeps running smoothly despite the transition. 

2. Calculate your budget and cost

What is your budget for outsourced HR services? Can you afford NOT to invest in proper HR functions? 

Compliance mishaps could lead to hefty penalties and put your entire organization at risk depending on your business and industry. For example, payroll processing errors or employee misclassification could result in fines and even lawsuits. Investing in the right team to guide you upfront could protect your business in the long run. 

Of course, you also don’t want to pay for more than you need. Ask each potential HR consultant how they structure their services and if they’ll customize a package for you. Be wary of those who lock you into bundles with services you don’t need. You should also avoid long-term contracts — you never know when situations may change, or you may decide that it’s not the right fit.  

You do not have to break the bank on unnecessary services. There are plenty of HR firms that will let you pick and choose your services or even come in to help you with specific projects and training topics, such as employee handbook creation or harassment training. Some even offer an HR hotline for employers and employees to call when they have urgent questions or concerns.

3. Research each potential HR consultant

Once you have determined your needs and budget, search for outsourced HR firms that provide the functions you need. Finding an HR partner who understands your industry is crucial, especially if your business is subject to specific laws or regulations. For example, certain trades businesses must stay abreast of labor unions and laws. 

And on top of federal labor laws, there are state labor laws. Often, state laws trump the federal laws when they lean more in the employee’s favor (e.g., minimum wage requirements). Your HR consultant should understand the local laws and how they apply to your organization. 

Next, check their certifications, track records, and references. 

  • Are they licensed and certified by trusted industry organizations like the Society for Human Resources Management (SHRM)?
  • Do they have case studies and third-party testimonials to share? 
  • Have they helped clients reduce costs or increase productivity? Can they share numbers? 
  • Better yet, do they have a client you can speak to directly as a reference? 

There’s nothing like unprompted social proof to speak to a company’s skills and integrity!

4. Consider your growth plan

What are your plans for the next few years? If you plan to expand, whether by employee count or physical location, it’s best to choose an HR firm that allows you to select the few services you need now but can grow with you in the future. 

Look for a partner that offers complete outsourced HR services, as your needs will likely change over time. Ask if they will: 

  • Design performance review processes
  • Assist with recruiting and onboarding
  • Manage performance issues
  • Provide conflict management
  • Guide the termination process
  • Deliver employee and leadership training

These are just a handful of tasks that become bigger and more time-consuming as your business grows. And not only will your capacity dwindle, but having a neutral third-party and outside perspective in these areas can add valuable insights.

5. Determine if you need onsite support

If you operate a fully remote company, this is likely not a concern. But if you have humans at a physical workplace, you may require regular onsite visits from your outsourced HR partner. 

Whether your team needs training that is simply more effective in person or you need someone to have those difficult conversations with team members, ensure that your HR team is available when and where you need them.

6. Know what you’re getting

Some HR companies provide what is essentially phone support. Instead of building a close relationship with a dedicated HR professional, you will get a different person every time you call for a question. This may be sufficient if you have basic needs and only call for the occasional advice. 

However, if you want a long-term relationship with an HR consultant who gets to know your business inside and out, you’ll want to look for another type of provider. Search for a firm that works as an extension of your team and offers a dedicated HR expert to work with you on an ongoing basis.

7. Make sure it’s a good fit

Since your outsourced HR partner will be working with your people, you’ll want to ensure they are the right fit for your workplace culture or the culture you’re striving for. After all, your HR consultants will be the ones helping you build that culture! Their style and values should align with your company’s and help maintain or boost morale. 

You should be able to trust your HR partner. Will they handle delicate situations with care and professionalism? What will it be like working with this firm? Consider how your interactions with them and customer service experience have been. Then trust your instincts.

Consider these factors and questions above as you evaluate your outsourced HR options. Don’t be afraid to ask questions and request references and testimonials upfront. When you have an action plan for hiring an HR partner, you will be much more likely to find the best fit. Soon, you’ll be on your way to a happier, more productive, more profitable organization. 

Are you ready to discuss your company’s HR needs and options? Contact BlueLion at 603-818-4131 or to chat with one of our HR experts today!  We’ll be happy to uncover and customize the best solution for your business.

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.