If you had to take a guess about who has one of the busiest positions in a mid-sized company, what would your answer be? The big boss, i.e. the CEO or President? Well, guess again. That position which is stressful and overburdened is that of the Human Resources Director. There are never enough hours in the day to get everything done and it is the lucky HR honcho who has a staff to help out. There were already enough policies to enforce, forms to create and distribute and records to be maintained, without the advent of the Affordable Health Care Act, or ObamaCare and its seemingly endless list of rules and regs. Of course, there were new procedures, policies and protocol to get up to speed on, and, just when those items were mastered and taken care of, the rules and regs got legs as even more new procedures were implemented beginning January 2016.
Besides pulling out your hair and working a lot of overtime, how does the Human Resources Director and staff keep abreast of all the changes in the workplace? One must be savvy as well on trending legal matters and be that go-to person with regard to the company’s open door policy when employees need to vent or confide about personal issues. A good H.R. Director worth their salt will interact with the company’s labor lawyer on a regular basis, as they consult on personnel or policy-related issues as well as a bevy of labor-related matters. If the workplace is unionized, there are even more issues to tackle, i.e. grievances, EEOC claims, unfair labor practice charges, plus, what good H.R. Director does not sit at the table for each bargaining session and immerse themselves in the bargaining process?
A good H.R. Director
We’ve established above just how valuable an H.R. Director and that department are to a company, whether it is a small, mid-sized or large company. To keep that job from becoming overwhelming, many companies have begun using professional employer organizations (a/k/a “PEOs”). PEOs are invaluable “helpers” who work onsite or offsite to unburden Human Resources and free them up for other pertinent company needs. On paper, it sounds wonderful, but, what exactly could a PEO do for your company? Could your H.R. Director relinquish many duties to a PEO? Should you consider using a PEO to solve crisis situations and routine labor-related matters that your trusty labor lawyer would generally handle? Here are some thoughts to consider before you make a hasty switch to a PEO or outsourcing firm:
You’ve no doubt heard the ads on the radio or seen them online – outsourcing firms that have the ability to step right into your company and handle a myriad of human resources, liability practice review and other typical labor-law type matters, a task usually reserved for your labor lawyer. More and more employers are happy to transfer the burden of completion of forms and record maintenance as a result of ObamaCare to someone who can handle the task for them. For applicable circumstances, PEOs are even skilled in safety review and safe OSHA practices in the workplace. They are trained professionals who are able to review, process and resolve workers compensation claims as well as deal with grievance step responses and step hearings. They are mindful of trends in discrimination or ADA, FMLA, etc. in the workplace and will be able to suggest and implement policy implementation for your company in the form of updates to employee handbooks and policy and procedure on a routine basis. They will assist with hiring or termination as applicable to that chore. Whew! Is there anything these folks can’t do?
Pros and cons of a PEO
The short answer is that utilizing the services of a PEO for processing paperwork relative to benefits, workers compensation, healthcare compliance and doing payroll is an excellent way to offload some of those time-consuming tasks and free up your H.R. Director or H.R. Department for other tasks. PEOs are a valuable tool for small to mid-sized businesses that try to make do with one H.R. Director and an assistant and cannot afford to hire additional staff to handle administrative duties and H.R. responsibilities. Utilizing the services of a PEO makes the most sense for small businesses that cannot afford to hire full-time human resources staff and/or don’t have the time to dedicate to the administrative responsibilities of human resources. Generally, PEOs are used by companies with fewer than 50 employees. To be clear, when you use the services of a PEO, you are assigned PEO employees to take over your H.R. administrative tasks on site – the tasks are not done remotely or off site.
It might not take much to convince you to use a PEO for your company given their ease in quickly assimilating into your company and their expertise in mastering the positions they are asked to fill. While there are many pros and cons to outsourcing your H.R. work, while business owners appreciate the efficiency, they bemoan the loss of control on all aspects of their business like when they were 100 percent hands-on. There is also the fee to factor into the decision to use a PEO. While some PEOs charge a flat fee for their services, others charge either by the particular service or even by the employee.
Farming out administrative tasks
Your best bet is to keep your labor and employment attorney’s phone numbers on your speed dial. While the PEO is able to dive right into business administration and H.R. tasks, you know you can rely on the expertise of your labor and employment attorney whose livelihood depends on soaking up endless case summaries like a sponge by studying labor-related periodicals to keep current on workplace discrimination or trending NLRB matters related to social media. He/she is immersed in traversing the legal quagmire on a daily basis. Your labor and employment attorney has delved into your employee files many times, done workforce analyses and knows the stellar employees from the malcontents and troublemakers. He knows the employees who are itching to be “employee of the month” and those who just show up at work. Your labor and employment attorney has instant recall of a contentious issue in bargaining from two contracts ago, and, if you pose a question about a contract from a decade ago, you’ll have your answer after a well-worn file is opened and meticulously written bargaining notes are found. Your attorney from a top employment law firm is familiar with past practice in dealings with the Union or circumstances mirroring prior incidents and can be the H.R. Director’s best friend in crisis.
So the takeaway is this – save your company the hassle of the endless stream of paperwork and administrative tasks, but, don’t kick your trusty labor and employment attorney to the curb just yet.