5 Things to Watch Out For When Choosing an HR Provider

Expanding your business is a great feeling, but more people means more people management and less time for everything else. Which is why many small businesses often choose to work with an HR provider. But getting the right service for the right price is critical. If you’re thinking of hiring an HR provider, make sure you avoid these five common threats.

1. Pressure Sales Tactics

Choosing your HR provider in response to an emergency situation is a natural reaction. But it makes you a perfect target for the pressure sales tactics used by some HR suppliers. With your eyes on your people problem and not the small print, you could end up in a long-term contract you simply don’t need. Try to cancel and you might find yourself trapped by a six-month notice period. Hardly the flexible approach your business needs.
One way round this is to work with an independent HR consultant. You’ll only pay for the service you need when you need it. And most independents won’t tie you into needless long-term contracts or catch you out with automatic renewals.

2. One Size Fits All Provision

Your business is not the same as any other. You have your own challenges, culture and way of doing things. Despite their best assurances, larger HR consultancies rely on standard processes, procedures and text book answers for their scaled-up business to be profitable.
When you’ve got an HR issue, you need someone to tell you what you can do, not what you can’t. Free from a constraining company rule book, independent HR specialists build an in-depth knowledge of your business to provide bespoke solutions. And, because they’re business owners, they combine legal advice with a keen eye on any commercial implications.

3. Call Centre Style Service

The call centre model might be fine for your mobile phone company, but employment services are delivered best face to face, not on the end of the phone. Like many call centres, large HR providers can have high turnover which leaves you explaining the same problem to different people (once you finally get through).
Using an independent HR consultant means developing a real relationship and a deep understanding of your business culture and the challenges you face. When jobs are best done in person, such as at times of change or crisis, an independent HR provider will stand shoulder to shoulder with you or your managers, to deliver the best results.

4. Sky-High Rates That Cover More Than Your Package

Larger HR consultancies may have lots of white papers and lovely offices but it’s the expensive rates and long-term contracts you pay for that cover them. Depending who you deal with, some larger consultancies take a tiered approach to their contracts with smaller organisations taking a back seat to larger companies.
Independent consultants have significantly lower overheads and will provide you with a price based solely on the service you require. They won’t tie you into long term contracts; you just pay for what you need, when you need it. There are countless examples of some of the larger companies automatically renewing contracts for five years, or even longer, meaning you could be liable for thousands just because you forget the renewal date!

5. Hidden Agendas For The HR Provider

It’s not just automatically renewing contracts that larger consultancies want to push you into. They often try to sell you their software and systems too. Not only are these expensive and possibly not required, but they make it harder for you to step away from the support required to run them. Changing systems is a tricky process that no organisation wants to do too often.
Choose to work with an independent consultant and you’ll find they know their area of expertise is HR and they stick to it. You won’t be tied in by IT systems making it easy for you to use and pay for your consultant only when you need them. Most independents prefer to work with happy customers who choose to be with them and not clients who stay because they have no choice.
Many small businesses are lured into working with big HR companies because of the promise of insurance that offers a level of free legal support should a claim go to tribunal. It’s important to note that if situations are managed properly, they shouldn’t get anywhere near a tribunal, making this insurance almost worthless. Also, watch out for legal costs. Once the free cover is used up (which won’t take long) many providers charge a premium for legal support, way above market rates.

From one Small Business to Another

Working with like-minded people often gives the best results. After all, part of the joy of running your own business is that you get to choose who you work with and that should include your HR provider. If you want hands-on, cost-effective HR support, get in touch by calling us on 0330 555 1139 or via email at hello@tercushr.co.uk.