Ever found worrying you’re doing something wrong when it comes to rostering or breaking a sweat over compliance and struggling to unearth the reasons behind unnecessary employee turnover? You’re not alone.

Expanding your team can be an exciting yet daunting task for business owners. As your business expands, so does the need to define a reliable workflow, manage employee wellbeing and make sure you are keeping on top of key responsibilities around compliance.

In the UK it is not a statutory requirement for businesses to have a Human Resources department, and this often means that HR responsibilities go to the line manager or business owner, taking up a lot of time and opening up risks as those who might not be qualified are tasked with making important decisions.

Luckily, we’ve got your back with some insightful tips on how to navigate the hiring process, DIY people management, as well as understanding why and when to hire a human resources manager.

Read on as we dive into the key signs you should consider hiring a dedicated HR professional. From rapid growth to legal compliance challenges and improving company culture, learn how Employment Hero can be your tech ally. Discover the sweet spot where DIY meets automation and how to help your team thrive by sculpting a path to success for your small business.

How do I know it’s time to hire?

Evaluate where you’re spending your time:

If you are a small business, there are a few elements to consider when answering the question of – to recruit, or not to recruit – one of the most vital being, understanding where you are spending your time and resources. Start by examining the different elements of people management, from everyday admin tasks to business-critical tasks such as employment law, employee training, payroll, onboarding and induction.

Deep dive into how many hours you spend managing HR tasks per employee, per week. If you find yourself spending over 10% of your time on this admin it’s likely to be chewing up valuable strategic time you could be spending elsewhere.

1. Payroll

Begin by evaluating your payroll processes: consider the number of employees, the time invested in processing payroll for each individual, and the frequency of payroll runs throughout the year. It’s also worth considering who is managing payroll, that time back could make a huge difference to an overstretched leader.

2. Onboarding

For onboarding, analyse the number of new hires annually and the time dedicated to processing paperwork for each newcomer. If you find yourself spending hours sifting through onboarding documents, employee handbooks and company policies on day one, consider where else you could be spending that time.

3. Time and attendance

Delve into scheduling and planning tasks, calculating the hours spent on rostering, schedule adjustments, and communications with employees regarding changes. Could there be an easier way to manage, or even automate, this process?

4. Compliance

In terms of compliance, factor in the number of employees requiring licences or certifications, the time spent keeping on top of these details, and the frequency of checks and reminders throughout the year.

Typically, HR Leaders spend around 86% of their time on administrative work, which in turn takes them away from their ability to up to focus on value-building activities such as meeting with senior staff and business partners, managing employee relations, engagement and development, operations management and executive hiring.

By scrutinising these elements, you gain insights into the manual efforts invested into an HR role, helping you determine when the scale of these tasks warrants the recruitment of HR support to enhance efficiency and strategic HR management in your organisation.

So, If you’re already tasked with being a busy business owner, it’s likely you’ll also want to spend more time growing your business, not fighting HR fires! Check out our HR compliance for more. 

Consider the size of your business

Understanding the size of your business and plans to scale is crucial to enabling a tailored approach to build an effective HR function that suits your unique needs. As the business scales, consider using the following employee headcount milestones as reference points for when you should consider hiring help:

• 1-10 Employees: At this stage, it’s likely manageable that you can still wear the HR hat in the early stages and utilise HRIS tools for basic tasks and automation.
• 10-30 Employees: As the business grows, start to think about hiring an HR generalist for diverse tasks and laying the foundation for a scalable HR strategy.
• 30+ Employees: It’s time for a dedicated HR specialist or HR department to navigate the complexities of managing a larger team.

The size of a business significantly influences the decision to make the first HR hire to take on tasks like resource allocation, the scope of responsibilities, culture and workforce dynamics, compliance and legal requirements, workforce planning, recruitment and talent acquisition. As your workforce expands, your need for a human resources manager to tackle the above will also increase.

Striking the balance between hiring and using an HRIS

So, you’ve realised that things might be scaling at a speed that means you’re itching to expand your HR team, but where do you start? Many small business leaders wonder if they should don the HR hat themselves, use a third-party company or hire their own HR expert. Well, the answer lies in finding the right balance as the company grows.

Balancing your budget:

Consider your budget wisely. Do you need a dedicated in-house team right away or could you use an HRIS to help your existing team manage the administrative tasks and employee matters?

Depending on your business size, implementing a user-friendly HRIS system can be a more cost-effective option when you’re getting started with HR management. The base costs of HR software platforms like Employment Hero are calculated per employee, so you know you’re only paying subscription fees relative to the size of your team.

One of the big benefits of an HRIS is it’s a long-term investment; it can be operated by a leader in your business at first and then handed over to an HR specialist as your business grows.

The downsides of hiring specialist help before you need it

• Significant costs: Hiring an HR manager involves expenses in recruitment, salaries, benefits, and ongoing professional development.
• Limited requirements: Your business may not yet require an in-house HR professional just yet, which could lead to a lack of utilisation of your new hire

While the option to use an HRIS over hiring an HR person can be a great option for businesses looking to streamline HR processes and reduce costs it may not always be the best fit in terms of business objectives, workflows and industry fit. It’s always a good idea to explore suitable HR technology built for small business owners and demo any platform to understand the depth and breadth of functionality that an HRIS can offer.

Deciding to take HR digital

HR is an area that’s steeped in time-honoured structures. HR existed long before the tech boom and pre-dates any digital roles. As long as modern companies have existed, there’s been an established way to complete HR tasks. But if your business is still stuck in Excel spreadsheets or even worse, paper-based, you are making your lives harder. You’re wasting valuable human resources on menial tasks and likely falling behind the competition when it comes to finding and retaining the best talent.

Whether you have a lean team, or are in the early stages of fundraising, choosing to use an HRIS instead of hiring a dedicated HR person can offset costs and offer several advantages, including cost saving, automation, scalability, employee self-service and easy integration with existing systems. 

Embracing an HRIS isn’t just a tech-savvy move; it’s a smart financial decision for SMEs. Tools like Employment Hero, act as virtual HR assistants, automating the tedious tasks that often consume valuable time and resources.

From seamless onboarding to effortless payroll management, HRIS tools are the unsung heroes that let business leaders focus their time on managing their people, not paperwork. Streamlining everyday HR-related tasks like uploading employee data, managing hiring processes and performance reviews can allow small businesses to focus on retention and career development opportunities.

By investing in a robust HRIS, SMEs can prevent the need for early-stage hiring of HR specialists, saving on overhead costs and allowing leaders to focus on what they do best – growing their business. It’s not just about technology; it’s about financial prudence and strategic growth. If you’re interested in learning more about taking HR digital,  check out our in-depth guide here. 

Finding the right fit

Navigating HR complexities can be a challenge for first-time business owners, who need to find the right balance of hands-on management and HRIS tools. Recognising signs for hiring an HR specialist, evaluating time spent on tasks, and considering business size are crucial.

If your team is growing rapidly but struggling to retain talent, you might want to consider how you are engaging with existing employees across the business. Simple reporting can provide you with insights that can help to provide a temperature check on your workforce allowing you to improve experiences for new employees and also hone in on areas like performance management so you can keep your employees engaged and energised.

Automate to accelerate:

Using an HRIS can be a game-changer for maintaining a lean HR team while efficiently managing employees and other essential HR functions. Employment Hero, as an HRIS tool, offers a plethora of features that streamline processes, saving time and resources.

Firstly, its automated onboarding and offboarding processes can significantly reduce the administrative burden on your HR team. New hires can complete paperwork and training modules independently, allowing their HR Managers to focus on more strategic tasks.

Secondly, Employment Hero simplifies leave management, ensuring accurate and compliant tracking without the need for constant manual oversight. This is particularly advantageous for a lean HR team, as it minimises the chances of errors and ensures that team members can manage their leave efficiently.

Moreover, the platform provides a centralised hub for employee data, making it easily accessible and eliminating the need for extensive manual record-keeping. This enhances data accuracy and saves time when HR professionals need to retrieve or update information.

Additionally, Employment Hero’s payroll management features automate calculations, tax compliance, and reporting, reducing the workload on your HR team during payroll cycles and keeping on top of the latest employment laws and business news.

HR for lean teams

Employment Hero acts as a force multiplier for a lean HR team by automating routine tasks, ensuring compliance, and providing a centralised platform for efficient people management. This allows your HR professionals to focus on strategic initiatives and employee engagement, contributing to the overall productivity and success of your organisation.

The best part? You don’t need a PhD in HR to use it. As your team grows, these tools become invaluable, streamlining processes and letting you focus on what matters – growing your business. Here’s our ultimate guide on taking HR digital.

Want to learn more about how to hire your first HR manager? Check out our at-a-glance-guide.