5 Key Benefits Of Outsourcing Your Global HR Services
Published: 2023-09-11 09:14:55

Companies perpetually pursue innovative methods in business operations to bolster efficiency, curtail expenditures, and concentrate on their core proficiencies. One practice that is garnering substantial traction is outsourcing global Human Resources (HR) services.  

A report by Deloitte further found that 72% of organizations outsource their activities, with more than 23% planning to do so soon. This process (global HR services) involves delegating several human resource management tasks to external service providers. 

Outsourcing HR allows your organization to focus on its core competencies while maintaining an efficient HR department. It has become a strategic choice for organizations to help them optimize workforce management, ensure compliance, and streamline administrative processes.  

This article will examine the five key benefits of outsourcing your global HR services that render it an attractive option for companies of every size and scale. These benefits illustrate the transformational potential of delegating HR responsibilities to external partners.  

 


## 1. You Remain In Control Of The Hiring Process
 

 

Your domestic HR department typically oversees the entire employee life cycle, starting with recruitment. While some organizations may delegate their hiring process to an external agency, many employers favor retaining authority to ensure they identify the most qualified candidates for their team.  

Should your company align with this preference, rest assured that you can delegate all other facets of international HR management without relinquishing your prerogative to choose new hires. 

When you collaborate with a [global HR services](https://velocityglobal.com/global-work-platform/) provider, you can still actively manage your recruitment process. For example, you may remain in control of the following:  

- publication of job openings,  
- meticulous evaluation of applications,  
- conduction of interviews, and  
- selection of individuals most fitting for the roles.
  

 

Your business can harmoniously benefit from this arrangement. As a result, you can handpick your international employees while eliminating the logistical challenges that usually bog down domestic HR departments. 

## 2. Cost Savings Awaits You
 

 

Outsourcing often entails expenses, yet the challenge lies in assessing whether these costs yield long-term fiscal benefits. Think about the financial implications of managing global HR in-house.  

To embark on this path, you must establish an entity within the respective country and assume the mantle of a dedicated human resources team handling all HR functions on-site. The financial commitment to compensate your newly assembled HR staff can swiftly accumulate.  

Take, for instance, the scenario where the average cost per hire is $4129, as per a report by the Society for Human Resource Management (SHRM). While this represents just one facet of the overall expenses tied to in-house HR management, it is notably substantial.  

By opting for HR outsourcing, you can expeditiously trim a substantial sum from your company’s expenditure, obviating the necessity of onboarding an entirely new HR team. 

In addition, outsourcing your global HR services extends its cost-effective appeal by sparing you from the overhead of establishing a new entity and from the dangerous terrain of costly penalties or legal entanglements resulting from inadvertent breaches of the law.  

Small businesses, in particular, stand to reap financial gains by outsourcing their HR responsibilities. Professional employment organizations often wield the leverage to secure more advantageous rates on comprehensive employee benefits packages. 

## 3. Assists in International Business Growth
 

 


Suppose your business embarks on a growth phase and ventures into international markets. In that case, it becomes imperative to harmonize your existing HR principles and policies with the requirements of local employment laws and country-specific requisites.  

This task, however, can be exceedingly challenging, and your current HR team may need more expertise and exposure. Employment legislation can vary significantly from country to country, demanding your HR team attain comprehensive familiarity with the legal landscape of each jurisdiction in which you operate.  

While some regions, such as those within the European Union, may operate under a similar framework, each locale boasts distinct HR customs, ranging from data privacy regulations to tax statutes. 

Global HR compliance is imperative for ensuring the success of your expansion efforts. It demonstrates why entrusting these intricacies to industry experts is one of the foremost advantages of HR outsourcing. 

## 4. Escape Payroll Complexities
 

 

Processing payroll is a continuous HR task where errors are a luxury you can’t afford. While setting up and handling payroll in your home country can already be a significant undertaking for your HR department, international payroll presents an even more substantial challenge.  

While paying employees may appear straightforward, it encompasses numerous complexities, including. 

- Determining an appropriate salary, 
- Incorporating bonuses as required or mandated by law, 
- Ensuring accurate payment rates for overtime work, 
- Calculating withholding amounts for aspects like income tax and social security
 

 

The last point is a complex matter. It depends on an employee’s income and can result in variations in tax rates and contributions to social security schemes by both the employee and employer.  

The good news is that you need not grapple with this complexity when you outsource your payroll to your global HR services. 

For instance, during [group coaching sessions](https://www.robinwaite.com/services/accountability), a tax expert possesses the expertise to determine the correct amount of income tax to withhold, taking into account the country’s progressive tax rates and Pay As You Earn system. 

Wherever your expansion endeavors take you, entrusting the intricacies of payroll to an expert emerges as a pivotal advantage of global HR services. 

## 5. Liberates Your Focus For Greater Tasks
 

 
 

One of the prime advantages of outsourcing your global HR services lies in the freedom it bestows upon your company. It allows you to dedicate your time and attention to more consequential pursuits.  

Instead of wasting time deciphering unfamiliar employment laws and tax codes, you can direct this time to what matters most: steering your business. The global expansion terrain presents many opportunities for focused efforts that your company needs to make to ensure its success. 

Moreover, this newfound liberty allows you to nurture robust relationships with your international workforce and cultivate collaborative relationships across your global team.  

Besides, a McKinsey report found that companies with high employee engagement and satisfaction are 21% more profitable, 17% more productive, and 40% less likely to experience turnover. Isn’t that what you want? 

**Conclusion** 

 
 

A company’s ability to move fast despite global events ensures business continuity. Salary and HR processes form the foundation of a business. 

It is possible to avoid this by outsourcing it to experts and utilizing the benefits of outsourcing global HR functions. 

However, companies must assess their needs, choose a suitable outsourcing partner, and maintain effective communication to maximize their benefits and ensure a smooth transition.