By definition, “Outsourcing is the process of hiring an external provider to do the work that was previously done internally. Outsourcing has become a widespread and increasingly popular alternative involving virtually every business area” (Mondy, 2012). Many companies are choosing to outsource some of, if not all of their human resource functions due to other companies being able to perform the functions more efficiently and have more knowledge in an area then the company itself. For example, many companies decide to outsource their payroll functions because of some of the different compliance issues for taxes and relieving the accounting department of having to handle withholding deposits and payroll taxes. With many companies facing collective bargaining and labor relation issues, the question that a company must review is ‘how will these issues be handled by human resources if the company outsources that function?’
At The Admin Center, Inc. where the author is employed, the company outsources many of its human resource functions. Some of those functions include payroll, legal compliance, benefits and administration, and drug screenings. By outsourcing these functions to another company, The Admin Center, Inc. can focus on the day to day operations of the business and work to increase their bottom line. It is important to note that the employees of The Admin Center, Inc. are not unionized at this time.
The Admin Center, Inc. specializes in the back office support for multiple sales agents nationwide and for other companies with a specialty in energy and green industries. The company is the broker for different natural gas and electric utilities nationwide where states are deregulated. Employees at The Admin Center, Inc. take the time to get to know their clients’ needs and are continually reviewing the different rules, regulations and restrictions put in place by a state to ensure that the client receives the best possible price for their natural gas and electric services. The majority of The Admin Center, Inc.’s business is in Illinois, New Jersey, and Pennsylvania.
Commonly Outsource Human Resource Functions:
According to Jamie Madsen, the author of Better Business – 5 Human Resources Functions, discusses the areas of payroll, legal compliance, benefits and administration, background checks and drug screenings and workforce analytics, which are the most commonly outsourced functions of an organization. Jamie Madsen also points out that, “It’s also important to understand that you can pick and choose which of your HR functions to outsource so that you can strike a balance between cost effectiveness and maintaining a comfortable level of control while ensuring your employees do not go without” (Madsen, 2013).
In many manufacturing organizations today, unions are a common feature. Some human resource outsourcing specialists offer labor relations services such as collective bargaining and negotiations,...