| Companies across the country are assessing their | | | | At the very least there is employee recruitment, |
| ability to remain competitive in an extraordinarily | | | | benefits, payroll, legislative compliance, employer related |
| challenging business environment. One factor that | | | | taxes, safety and discipline. Ideally, employee retention, |
| makes this period of corporate realignment significantly | | | | training and productivity measures in the mix as well. A |
| different from the adjustments that took place in | | | | professional and experienced PEO firm such as can |
| previous recessions is the increasing prevalence of HR | | | | step in and take over all of these functions, providing |
| Outsourcing as part of the agenda. | | | | cost savings, and expert knowledge of each of these |
| Previous attempts to cut costs across an organization | | | | requirements, no matter how big the company. HR |
| were frequently driven by the Human Resources or | | | | Outsourcing can not only have a significant impact on |
| Personnel Department. What makes things different | | | | the bottom line, but its not uncommon for a company |
| this time is that cuts need to be deeper to survive the | | | | to improve its overall operational effectiveness as a |
| economic downturn, but cutting too deeply into the | | | | result. By assuming many of the risks and |
| revenue generating workforce -the assembly, | | | | responsibilities that the company had carried as an |
| production, shipping and sales departments- would | | | | employer and taking over most of the administrative |
| cripple the company. No product or no way of selling it | | | | and bureaucratic workload using proven methodology |
| makes little sense. In looking at their structure, many | | | | and experienced consultants, Employee Leasing can |
| companies have come to the realization that HR itself | | | | reduce costs for each worker at the company by |
| actually constitutes a large part of their payroll and | | | | hundreds of dollars. |
| would make an ideal target for cost reduction through | | | | Because of the smooth transition to an Employee |
| employee leasing. Professional Employer Organizations | | | | Leasing arrangement, ongoing payroll savings and the |
| (or PEO) have proven to be a viable alternative when | | | | ability for senior management to concentrate on |
| HR Outsourcing makes sense. In fact, many firms | | | | business (leaving payroll, employee retention, |
| have thrived under this arrangement, finding that | | | | recruitment, workman’s compensation and labor |
| without having to deal with human resources functions | | | | legislation compliance and other issues to the HR |
| internally, management is free to focus on core | | | | Outsourcing professionals), I predict that many |
| competencies. | | | | companies will choose to continue operating without an |
| Consider the wide range of functions that typical | | | | in house Human Resources Department long after the |
| companies lump under the human resources banner. | | | | country is back in positive economic territory. |