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If your business is a small or medium-scale enterprise, you can get by without a human resource department. However, as the company grows, you need a dedicated employment expert to manage your personnel. An HR department does more than handling employee matters; it develops growth strategies and promotes business success. Let’s look at the best time to hire an HR team and their role in your organisation.

When Does Your Business Need an HR Department?

Every business has a unique timeline for introducing a human resource department. However, you need an HR specialist if:

The Employment Laws Are Changing Regularly

Employment laws are constantly changing to cater to the diverse work environment and employment landscape. For instance, recently, employment legislation introduced pension auto-enrolment and childcare benefits. Parental Bereavement Leave closely followed the new laws, and employers need to adjust their work schedules to cater to the new rules. Failure to keep up with the legislation often causes compliance issues and fines. Introducing an HR department ensures you stay on top of the legislation trends.

Business Expansion

If you are constantly hiring new staff due to increased workload or business expansion, it is hard to ensure you recruit the best workers. Without a human resource department, you cannot develop the best recruitment and retention strategies. As an entrepreneur, you may also lack time to review employee performance. HR specialists can help you create job descriptions that attract the best talents and determine the strengths and weaknesses of your current workforce. From the performance reviews, you can find the best strategies to improve productivity.

Increasing Employee Disputes

As you increase the workforce, disputes are likely to arise, from harassment claims to unfair treatment and salary disputes. If you wrongly handle the conflicts, you will end up with a lawsuit that will ruin your reputation. HR specialists can prevent disputes and handle any complaints through mediation, and they will develop strategies to promote harmonious working relationships.

Lack of Time to Deal With Personnel Issues

SMEs often hold off hiring an HR manager due to the associated cost. The consequence is that a manager will be forced to handle human resource functions. If you spend time dealing with HR issues, you won’t have enough time to deal with other vital responsibilities. With a human resource team, personnel issues will be off your plate, and you can concentrate your efforts in different business areas.

What Issues Does the HR Department Deal With?

The current labour market is challenging due to the fast-changing legislations and increased emphasis on better treatment of employees. Hence, companies need human resource professionals to help them navigate the landscape. According to statistics, 9 in 10 HR professionals contribute to the overall company strategy. The increased popularity of HR teams is due to their expertise in the following areas:

Recruitment and Hiring

When the company needs additional employees, the HR team is responsible for identifying the best talents and filling up the positions. Recruitment is a tedious process, and without professional help, the company can recruit the wrong candidate and lose money. Human resource personnel are always looking for top talents and can screen suitable candidates before hiring. They also conduct interviews, background checks and tests to ensure the new hires are the best fit for the company.

Processing Payroll

Payroll processing is a complex process in most organisations. Without a dedicated HR department, expect mistakes in tax deductions and complaints of unfair pay and wrong deductions. The HR department ensures employees are compensated based on the work hours and with the correct deductions. They also reimburse expenses and incorporate bonuses for every pay period to ensure employees receive fair compensation. Sometimes they have to review the payment structures and ensure they are compliant with the industrial regulations on minimum wages and pension schemes.

Employee Disciplinary

The disciplinary role of the HR department usually gives it a bad reputation but is necessary to ensure productivity. The wrong approach to disciplinary has negative ramifications like litigation and loss of valuable workers in the company. Fortunately, HR personnel are experts in handling disciplinary actions and can use the opportunity to improve the performance of the employees. For instance, instead of firing a worker for lateness, the HR team will investigate the reason for behavioural changes. Instead of suspension, they will introduce counselling or training programmes that will boost productivity.

Employment Laws and Policies

Aside from keeping up with the changing employment laws, the HR department needs to regularly update the company’s policy. When a company policy no longer benefits the organisation or employees, the personnel department will suggest the necessary changes. It is also their responsibility to clarify issues to employees to avoid confusion. For instance, they translate the company policy on pension schemes, procedures for requesting a leave of absence or sick days.

Performance Management

Human resources are responsible for managing the productivity levels to ensure employees meet expectations and are engaged. The performance management role involves setting goals and targets for each worker and reviewing their performance regularly. With performance reviews and employee surveys, the HR department can identify gaps in the company and the best training programmes to introduce. Performance management isn’t effective if there is no reward for top performers. That is why HR professionals are responsible for identifying reward schemes and incentives to motivate top performers.

How Do Human Resource Departments Support Employees?

The responsibilities above are the primary functions of the HR department. However, they perform other less quantitative roles to ensure employees thrive in the work environment. HR supports the emotional needs and career prospects of employees in the following ways:

Career Growth

When employees stagnate in the company, they will look for opportunities for career progression in other organisations. However, HR can provide a clear career path for the best employees within the company. That way, you will retain your best workers and help them grow in your organisation.

Ongoing Training Programmes

As technology advances, some company processes become obsolete, and employees may need training on operating the new machines. HR can organise regular training sessions to provide continuous education on upcoming industry practices. Such training programmes make your workforce adaptable to industry changes and prepare them for career progression within the organisation. The human resource department will collaborate with operations managers to ensure the work schedules provide flexibility to attend the training programmes. HR should also organise training sessions, retreats and team-building programmes for managers to keep their teams engaged and productive.

Supporting Employee Wellbeing

Employees are vital in any organisation. Therefore, they need support during personal emergencies like bereavement and family emergencies that require immediate leave of absence. HR will liaise with the relevant department before granting the leave requests and create a return-to-work plan. A human resource specialist will also recognise signs of mental health problems and recommend a treatment plan without compromising the affected employee’s work.

Creating a Positive Work Environment

The HR team should create a conducive workplace for optimal employee performance and provide a safe space for employees to make complaints and report unfair treatment. Creating an optimal workspace begins with promoting diversity and ensuring equal treatment for all employees regardless of race, religion, gender and physical abilities. Sometimes, it is necessary to design a code of conduct for employee-employer relations and conduct sensitisation programmes. The HR team is also a reliable confidant to whistle-blowers to ensure employees can report misconducts without victimisation.


A good human resource department will create a productive workforce by improving the recruitment standards and aligning them with your organisation’s long-term goals. Apart from promoting company growth, the HR team should also focus on employee growth to ensure their needs are not ignored. Providing employee support will improve engagement and reduce turnover.