Question 1

What is an HR outsourcing company?

Accepted Answer

An HR outsourcing company is a third-party company that manages various human resources (HR) services on behalf of its clients. These companies allow businesses to focus on their core operations by handling HR-related tasks, such as attracting and retaining top talent, employee benefits, performance tracking, payroll, etc. With the expertise of HR outsourcing service providers, businesses can improve efficiency, reduce costs, and meet regulatory requirements without the costs and challenges of maintaining an in-house HR department.

Question 2

What services do HR outsourcing companies provide?

Accepted Answer

HR outsourcing companies provide recruitment, employee satisfaction, time management, payroll, and complementary services.

Their responsibilities typically include:

Recruiting: Job posting, attracting top applicants, interviewing, and selecting the best candidates
Onboarding: Helping new employees get familiar with the company processes
HR administration: Handling tasks related to employee data administration, including organizing and maintaining personnel records, managing the employee database, preparing contracts and other HR documents, etc.
Employee relations: Maintaining a positive and collaborative work environment to boost employee satisfaction and engagement and employing strategies to reduce turnover and improve employee experience.
Safety management: Evaluating and minimizing the risk of any employee safety risks
Compliance: Ensuring that the company follows labor laws and regulations
Payroll processing: As the most common outsourced HR function, payroll administration includes calculating total earnings, filing payroll taxes, and delivering payments.

Question 3

How much do HR outsourcing services cost?

Accepted Answer

HR outsourcing services cost from $45 to $1500 per month, depending on the scope of services provided, the company's size, the complexity of HR needs, and the level of expertise required.

Basic packages might include essential HR functions such as payroll processing and benefits administration, while more comprehensive packages can cover compliance management, employee training, and strategic HR planning. The cost also varies based on whether the service is provided on a per-employee basis or as a flat fee.

Here are typical HR outsourcing costs:

Recruitment: Up to $8000 for 100 candidates
Compliance management: $12,000 per year
Payroll: Up to $250 per employee
Compensation and benefits: Up to $165 per year
HR management software: Between $70 and $100 per month

The top 50 HR solutions companies on DesignRush charge an average of $60/hour. Roughly 16.60% of the HR outsourcing companies on DesignRush accept projects with a minimum budget of less than $1,000, while 8.4% require a $50,000+ minimum budget.

Question 4

Why should I hire an HR outsourcing company?

Accepted Answer

You should hire an HR outsourcing company to streamline operations, improve efficiency, reduce the costs of HR processes, and ensure compliance with labor laws and regulations.

These are some of the benefits of hiring an HR outsourcing company:

Quicker recruitment: Most HR service providers already have a large talent pool and will be able to offer high-quality candidates very quickly.
Cost savings: Outsourcing HR processes is cheaper than delivering them in-house. For instance, outsourcing compliance management costs around $12,000 annually, compared to around $200,000 annually when handled internally.
Improved compliance: HR service providers know all about the legal aspects of work and will ensure that your company doesn't break any laws or rules that could lead to lawsuits.
Payroll processing: By outsourcing this HR process, you ensure that your employees get paid on time and that all tax-related processes follow the law.
Focus on core business activities: By letting HR solutions companies handle all your HR-related tasks, your management can focus on core business activities and company growth.

In the following example, we can see how helpful outsourced HR companies can be:

Softorino, an indie software company that makes utilities for macOS and iOS, was looking for a digital marketing specialist. The company needed professional experience using digital marketing tools and familiarity with macOS and iOS technologies. Outstaff Your Team, an HR outsourcing company, found two candidates who were a perfect fit for the role, and the company CEO decided to hire both finalists and extend his team with two digital marketing specialists.

Question 5

How do I choose the right HR outsourcing service for my business?

Accepted Answer

To choose the right HR outsourcing service for your business, consider the company’s experience in your industry, existing portfolio and case studies, pricing plans, and expertise in different HR services.

Based on your company's needs, you should focus on these steps:

Identify your goals: Define the goals you want to achieve through HR outsourcing, i.e., to hire ten new employees, improve employee retention rate by a certain percentage, ensure compliance, etc.
Find the right expertise: Visit the DesignRush agency directory and find an HR outsourcing company with experience in the services you need. You can tailor your search by location, team size, hourly rate, and other criteria.
Set a budget: Determine the amount you can invest in this HR outsourcing project.
Review agency experience: Ask for a portfolio of relevant work, case studies, reviews, and clients you can contact for feedback. Ideally, the agency should have tangible results with companies from your industry.
Ask about the strategy: Find out how the agency plans to approach the project and ensure the goals are met.
Inquire about analytics and reporting: Ask the agency how it tracks metrics and if it uses any kind of HR management software.
Ask for proposals: Send a request for a proposal (RFP) to the shortlisted HR outsourcing agencies.
Interview: Set up interviews with prospective HR outsourcing agencies to discuss the project in detail and determine if they fit your team well.
Make a decision: After reviewing the RFPs, choose the best-suited agency and establish all project development processes.

If you need a custom-made list of HR outsourcing service providers, contact us. Our team will match you with the most suitable agencies based on your list of requirements. You can browse our Marketplace for more details.

Question 6

How do I find the best HR outsourcing firm on DesignRush that fits my budget?

Accepted Answer

To find the best HR outsourcing firm on DesignRush that fits your budget, use the filtering feature to sort agencies by minimal budgets in ascending order or by hourly rate from lowest to highest.

If your budget is limited, look for outsourced HR companies that accept projects under $1,000. Firms like Remofirst, Xceed Bangladesh Ltd., Zaag Systems Ltd., Krazy Mantra, and TargetedWebTraffic all require a minimal budget below $1,000.

The average hourly rate varies from country to country, so you may consider hiring an agency outside the US that offers more affordable rates.

Question 7

What are the key success metrics in HR outsourcing services?

Accepted Answer

The key success metrics in HR outsourcing services include:

Cost per employee: The total amount of money spent on HR services divided by the total number of employees
Cost per hire: The average cost of hiring a new employee, including internal and external hiring costs
Time to hire: The average period between posting a job and a candidate accepting the offer
Time to productivity: The time it takes for a new employee to get accustomed to the company and start working at full productivity.
New hire turnover: The number of new employees that leave within a certain period (i.e., within their first year)
Employee satisfaction: The number of employees that highly rate working conditions and would recommend the workplace to others
Retention rate: The opposite of your turnover rate in that you divide the number of employees who remained in your organization over a given period by the number of total employees.
HR software ROI: The costs of using HR software versus the money saved by using the software

Question 8

What questions should I ask before hiring an HR outsourcing company?

Accepted Answer

You should ask HR outsourcing companies about their relevant HR experience, the HR management software and tools they use, their services, and their approach to delivering your HR efforts.

These include the following:

Its Relevant Background

How many years of experience do you have in outsourcing HR services?
Do you have a portfolio of relevant HR projects?
Do your team members have relevant HR certifications and knowledge?
Do you have experience working with companies from my industry? Are you familiar with its specifics?

Its Services and Processes

How do you plan to attract top talent?
What strategies will you use to improve employee satisfaction?
What is your talent acquisition process? How many rounds of interviews will you do?
What level of engagement do you require from our team leads and management during the recruitment process?
Will you use personality tests or other techniques to determine if future employees are aligned with the company culture?
How will you define and grow the company culture?
How do you plan to ensure a high employee retention rate?
Would you suggest some team-building activities to improve employee satisfaction?

Related to Your Project

How do we define project milestones? What happens if they still need to be met?
Who are the key team members who will be working on my project?
What metrics will you use to define the success of our HR efforts?
How often will you provide us with status reports and relevant metrics?
What is the expected deadline to successfully finish the recruitment process? What happens if the project is late?
What is the planned budget? Are there any additional costs we can expect?
What kind of support can you provide after completing the project?

Question 9

What are the best HR outsourcing companies in the US?

Accepted Answer

The best 5 HR outsourcing companies in the US are:

Corban OneSource
- 4.6 stars on DesignRush (3 reviews)
- 5.0 stars on Google (3 reviews)
- Top clients: StarKist Co., Impact Plastics, Sterling Organization, Embassy Suites Hotels
StaffScapes
- 4.5 stars on DesignRush (2 reviews)
- 5.0 stars on Google (9 reviews)
- Top clients: Dr. Harrison's Center of Functional Medicine CFM, Luke Pile, Projex Inc., Marc Beacom
Stratus.hr
- 4.4 stars on Google (39 reviews)
- Top clients: Spring Mobile & Simply Mac, Skidmore & Olausson, Brett Bradshaw, Edlaine Tunuchi-Heidman
ExtensisHR
- 4.2 stars on Google (83 reviews)
- Top clients: Monarch Benefit Advisors, A&C Management Group, CJ Partners, Premier Benefit Plans
Insperity
- 3.7 stars on Google (3 reviews)
- Top clients: Octane, Alius, CoreRx, Explora BioLabs

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