Home - HR Outsourcing, Employee Retention - Why Does HR Outsourcing Improve Employee Engagement?

Why Does HR Outsourcing Improve Employee Engagement?

Why Does HR Outsourcing Improve Employee Engagement?

Teams of highly engaged employees are, on average, around 21% more profitable than teams that lack that overall sense of engagement. Unfortunately, all too many employees are disconnected. Only around 32% of employees are actively engaged at work. As a result, many businesses are not seeing the high profitability they could otherwise expect. 

There is a common myth that HR outsourcing leads to alienated employees. In reality, however, the opposite is true. Companies that use comprehensive HR outsourcing often see a lift in overall employee engagement.  

Let’s look at how outsourcing your HR needs can engage employees and increase their sense of connection to the business.  

5 Ways Comprehensive HR Outsourcing Improves Employee Engagement  

Comprehensive HR outsourcing can positively benefit overall employee engagement across your organization.

1. Outsourcing HR enables in-house HR employees to focus on strategic HR activities that improve engagement. 

When you outsource your HR services, your in-house HR team can do several things to help improve overall employee engagement and strengthen personal ties within the business. For example, they can: 

  • Recognize employee accomplishments and contributions 
  • Schedule activities that engage employees 
  • Strengthen overall company culture 
  • Offer training and support opportunities to your team members 

With their basic tasks taken off their plate, the in-house HR team can focus on uplifting and engaging employees rather than spending their days taking care of paperwork.

2. Outsourcing HR Improves Employee Benefits 

By outsourcing HR, you can often get better employee benefits. With better benefits, you can see a corresponding shift in engagement in several key ways.  

First, you'll be more able to attract and retain the top talent in your industry. Those employees are, as a rule, more likely to be fully engaged with the organization. 

Second, better benefits mean employees can get the care they need, which means they're less likely to show up sick or struggle with ongoing problems. Finally, better benefits may make it easier for employees to focus since they don't have to worry about other outside factors. 

Why Does HR Outsourcing Improve Employee Engagement

3. Cost Savings 

An HR outsourcing partner can identify how the company can reduce hiring, training, and retention costs. You may be missing out on critical areas where you can cut costs. Once you have established those areas, you can use those funds to invest in employee training, wellness programs, and other initiatives that can help increase your employees' overall engagement. 

4. Employment Law Compliance 

Nothing sinks engagement faster than being found violating a law that covers your employees. Employees who discover that your company is not caring for them may quickly disengage at work. They may lose their sense of trust in you. If they do not already have one foot out the door, they are certainly less likely to give it their all.  

With an outsourced HR provider, you can feel confident that your business complies with the latest rules and regulations. Your HR services provider will keep on top of any changes in the law, from tax withholding for the upcoming year to ensuring that you help protect your employees' privacy. As a result, employees will feel a deeper sense of commitment to and trust in the company.

5. Payroll Outsourcing 

Payroll mistakes can cause employees to look elsewhere for a job. Employees count on their paychecks showing up on time every pay period. Even minor errors, from a late paycheck to a check that is missing an anticipated bonus or extra hours, can cause severe financial repercussions for employees. It only takes one or two mistakes for employees to start looking for an employer that will show more respect for their needs.    

Comprehensive HR outsourcing partners handle payroll processing and filing employment taxes for you. Having an outsourced HR provider take care of your payroll can help reduce errors and delays and ensure your employees' checks arrive on time.  

Comprehensive HR Outsourcing with a PEO  

A Professional Employer Organization (PEO) helps provide many essential HR services employers need most. It helps handle payroll, benefits, and other vital tasks across your business. Often, PEOs can improve employee benefits by offering better overall benefits than the company can obtain, since they can get better deals than a small or medium business. Only PEOs can give you access to more affordable, Fortune-500 level benefits like better group health insurance. By working with a PEO, you can often offer better options for your employees, which can, in turn, increase employee engagement across the organization.  



HR Outsourcing, Employee Retention