If your business is growing and you're bringing on more employees, at some point you'll have to decide if you need to hand over HR responsibilities to someone else who knows the ins and outs of hiring, benefits, labor laws and more.
But when is the right time?
There's no secret formula that says you need an HR professional after you have "X" number of employees. Plus, every industry is different. But there are some basic questions you can ask yourself to help you decide.
What's my time worth?
When your company is small and agile, you probably handle most of the HR-related issues. When I was starting my company, VerticalResponse, I sought an insurance broker that could provide health benefits to our employees, a payroll company and an employment lawyer myself, not really knowing what I was doing!
But as your company gets to be a bit bigger, these things might be dealt with by different department heads. For example, the head of finance might oversee payroll. Department heads also probably handle personnel issues within their teams, like complaints, hiring and training, questions about insurance coverage, and so on.
How experienced are they in handling these responsibilities? Is it taking them away from doing their jobs? Are they putting HR issues on the backburner because they either don't have time or don't know how to deal with them?
If HR-related job functions are taking up too much of everyone's time, or getting in the way of running of your business, then it's probably time to bring on someone who can focus just on HR.
When we got to be about 40 employees, one of them saw how we weren't really managing that function, and because she had a real passion for it, she raised her hand and said that she'd like to be our HR person. We sent her to school to learn how. It was really great because she knew the ins and outs of our company and spent the next four years getting and keeping us in shape.
What do I want my HR person to do?
By the books, HR is the management of the internal structure of a company. It can include everything from recruiting to orienting new employees, writing job descriptions to tracking attendance, and establishing policies to making sure you've got the right benefits. HR helps formalize the inner workings of a business and makes sure there are processes for employees to follow.
But because every company is different, every HR person's responsibilities can be different, too. For example, if offering amazing employee benefits is important to you, you might want someone who has more experience in that silo since HR can be so specialized.
At my company, our HR director and her team (which includes our office manager) are also responsible for things like happy hours and volunteer days because it's important to me for employees to get to know each other outside of work.
Can my office manager do the same thing?
People often confuse the terms office manager and HR manager. You're not going to want to assign someone who specializes in compensation best practices to tasks like coordinating office moves. The same is true with handing over highly technical responsibilities to someone who doesn't have the proper qualifications. So, know what you want and hire accordingly.
Full-time or outsource?
Does your budget prevent you from hiring a full-timer? If so, you might be able to make do with outsourcing tasks like recruiting, payroll and benefits to vendors like TriNet, ADP or Insperity (formerly Administaff). Keep in mind, though, that what you usually don't get with a vendor is the peace of mind knowing there's someone on staff who is familiar with your work culture and all of your employees on a personal level.
An HR manager can bring a lot to the table, but only you know what specific skills you need in your company to keep things humming smoothly. Hopefully these four questions will get you closer to figuring out what you need. Good luck!