When is it a good idea to have a payroll provider handle your human resources needs? It’s an important question.
It reminds me of a colleague who still bemoans the day she let her dentist do a root canal. She was in pain for months, and like a phantom, the ache returns from time to time. She still wonders why she didn’t ask for a specialist referral.
In business, choosing the wrong provider happens more often than we like to admit. There are plenty of reasons: selecting someone you know personally, picking the convenient solution, going with the lowest price or opting for the well-known national brand. Perhaps you think nothing bad will really happen, so ‘good enough’ is good. Until it isn’t.
When it comes to HR, we all learned that lesson the hard way. Who would have ever imagined that a pandemic would upend our operations, our workers and our livelihoods? True Human Resources expertise is no longer a ‘nice to have.’ It’s a vital business function.
Many claim to be HR experts, including payroll providers. But like the dentist doing my colleague’s root canal, there are plenty who know just the basics. Remember, the right HR provider is a business partner who will guide you on critical issues like vaccination policies, hybrid and remote work models, staffing configuration, business processes and workforce issues such as diversity and inclusion, pay equity and immigration.
They will also coach you—or handle for you – difficult conversations, say with employees who want to work 100% remotely, or with a staff member you need to let go.
Should you trust a payroll company to advise you about your most important asset—your people? Maybe, maybe not. Here are five key questions to ask in order to find out.
1. What is your business model?
Start with the company’s core focus. Many payroll companies are just that and utilize technology for their HR solutions. Think: online training and automatic updates to employee handbooks. Others are national payroll brands with expertise at the senior level, but a rotating cast of account representatives and specialists. Then there are financial firms who have expanded their business with payroll solutions and HR is an add-on. Ask the sales representative to explain the company’s business model as well as their longevity doing human resources.
2. Who will be on my team?
You may have a great rapport with the account representative, but it’s the people behind the scenes who will be doing the work. Will you have a dedicated HR team? How many years of experience does each person have and are they credentialed by the Society for Human Resources Management (SHRM)?
Certifications demonstrate an individual’s commitment to their profession, their upholding of industry standards and their dedication to continuing education. Certified professionals keep up with the trends, they understand best practices and they meet the highest standards of professionalism.
3. What is the process for handling HR issues as they come up?
It’s important to know how responsive your advisor will be. Ask what your expectations should be. When you call the company do you get voicemail with an automated menu or does a person answer the phone? If you have a question or problem, how long do they typically take to get back to you with a solution? Will you have access to your dedicated HR specialist, or will you speak with the agent on call who may or may not know you?
4. What about an HR plan?
The best firms have a dedicated and proven process to help determine your needs, monitor your people issues and offer proactive recommendations. They build trust with you, your managers and your employees. In essence, they become an extension of your team.
5. Do they have capacity and are you a fit for the size of client they want?
Are they a huge payroll company? If so, you may be just one of thousands of clients. That’s okay if you’re a corporation with thousands of employees but if you’re a smaller business, say with 100 employees or less, you might get short shrift. On the other hand, if you’re considering a smaller payroll firm, they may have just one or two qualified people who handle the HR function and they may be juggling numerous accounts.
What if they go on vacation, become ill or leave the firm? Don’t be shy about asking what an ideal client looks like for the advisor you are considering. The right fit is just as important as the right people and process.
In the end, HR comes down to people so you should know the people behind the payroll/HR partner you may be considering.