Start-Up Business On A Tight Budget? Here's How To Do Without An HR Department

Insurance Blog

If you're starting up a business, you're probably looking for ways to stay within a tight budget. One of the biggest expenses you may be looking at is a human resources department. Here's how you can outsource all your HR tasks with an employee benefit services company, which will save you money, time, and space.

What Is an Employee Benefit Services Company?

Employee benefit services companies are a relatively new phenomenon in response to changes in the economy and the needs of small or start-up businesses. They provide services normally performed by a traditional in-house human relations department. However, because they are housed off-site, you do not need to have office space or equipment for them.

You also don't need to pay HR staff salaries and benefits when you use an employee benefits services company. There are different payment arrangements available, depending on whom you use, but typically a fee or percentage of your employees' wages are used as compensation.

What Tasks Can Employee Benefit Services Providers Do?

Employee benefit services providers can handle a broad range of tasks that might overwhelm a start-up HR department. These include

  • payroll and taxes
  • retirement and 401(k) programs
  • flexible spending accounts
  • data and reports for government compliance
  • health insurance
  • EAP (employee assistance programs)
  • employee handbooks and safety policies

Employee benefit services can also manage the hiring process. They can advertise for jobs and screen employees, and they also offer background checks and drug testing. You can participate in the process to the degree you have the time and inclination or let the employee benefit services company staff handle everything from soup to nuts. 

What Are Some Other Advantages to Using an Employee Benefit Services Company?

There are other advantages to using an employee benefit services company too. One of the most time-consuming tasks for employers and HR staff is staying current with employment law and health insurance changes, and they can do this for you. They can also handle paperwork and claims relating to but not limited to

  • the Affordable Care Act (ACA)
  • Medicare
  • workers compensation
  • state unemployment
  • COBRA (health insurance for discontinued employees)

Employee benefit services companies have the buying power of bigger corporations because they work for multiple businesses This means you get better prices on insurance policies, which saves money for both you and your employees.

Additionally, you'll save money by not having to purchase, run, upgrade, and store software and IT equipment related to HR tasks because employee benefit services providers have that covered. Some even offer software for you to use for accounting or expense management.

Employee benefit services companies make it easy for business owners to work with them. Much of the work can be done online, and there are interfaces for employees to manage benefits via the Internet too. If you want to save money, office space and aggravation when starting up your business, consider an employee benefit services company, and say goodbye to worrying about assembling an HR department.


19 November 2015

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