Rather than building and supporting an internal HR team, many businesses rely on HR outsourcing companies (HROs). HR services can help you save money while obtaining indispensable expertise and protection in the areas of labor laws, payroll, employee benefits, and recruiting.
To choose the best HR outsourcing companies, we looked for a combination of adaptability and value. While each HR service differs slightly in its approach, those that made the cut offer customized solutions and excellent customer service.
Most importantly, each provider is backed by HR professionals, ensuring that the needs of your people are met with compassion and professionalism.
Best HR Outsourcing Companies for 2023
|Bambee||Highly affordable HR guidance provided by a dedicated HR manager||Small businesses looking to develop and implement HR compliant policies|
|TriNet||Adaptable HRO solution with outstanding 24/7 client support||Businesses with at least five employees seeking industry-specific HR expertise|
|Axcet HR Solutions||IRS-Certified PEO with a knack for developing customized HRO solutions||Small to medium-sized businesses that wish to offload HR work to a team of skilled professionals|
|Insperity||HRO and PEO company with a comprehensive array of benefits, payroll, and recruiting services||Larger businesses looking to offer competitive benefits packages|
|BambooHR||Intuitive software-based HR approach with an emphasis on employee data||Small to medium-sized businesses looking to streamline HR processes for employees|
|Justworks||User-friendly HR software combined with affordable benefits services||Small businesses looking to provide their employees with seamless onboarding and generous benefits|
|ExtensisHR||Mobile-first HR platform that helps build HR processes from the ground up||Startups, small businesses, and remote teams looking to offset the workload of HR processes|
If you’re looking for a simple way to build and implement HR policies in your business, Bambee is an excellent choice. Their HR Autopilot package starts at only $99 per month, and it provides you with all the tools and expertise you need to create effective workplace policies.
With Bambee, you’ll be matched with a dedicated HR manager who will assess your company and identify any existing HR gaps, policies, or operating issues that endanger your company or its employees. From there, your Bambee manager will collaborate with your team to draft customized policies that both reify your culture and protect your organization.
As an optional add-on, Bambee clients can also opt for payroll services. While not as fully featured as other payroll services on this list, Bambee’s payroll solution includes two-day direct deposit, wage regulation guidance, and automatic handling of federal, state, and local tax filing.
- Support and guidance from a dedicated HR manager
- Development and implementation of HR compliant policies
- Employee onboarding and training
- Comprehensive HR audits
- Employee termination services
- EEOC-compliant document storage
While the expertise of Bambee’s HR managers is undeniable, their HRO services lack benefits administration and recruitment strategies. Additionally, Bambee does not currently work with organizations of over 500 people.
Both simple and affordable, Bambee is ideal for new businesses looking to establish some HR best practices. Whether your HR team is undersized or nonexistent, a Bambee HR manager can help implement solutions that protect your business and its teams.
|# Employees||Monthly Cost|
Annual billing with Bambee will help you get up to 20% off.
TriNet offers an impressively wide array of HRO services, from benefits administration to risk mitigation. Their team can develop customized solutions for businesses of varied sizes. Their HRO packages are tailor-made to the needs of your business, and their pricing model allows for flexibility and iterative additions of new services.
What distinguishes TriNet from comparable HR outsourcing companies is the industry-specific expertise of their teams. When you’re matched with one of their HR experts, TriNet will make sure that they have the commensurate experience of the realm in which you work. So whether you run a 501c3, a life sciences company, or an education startup, you’ll have access to the best HR practices in your field.
TriNet’s cloud-hosted software is also a breeze to use. Accessible from both smartphones and computers, TriNet’s interface is easily navigable by both employers and employees, and it also allows for seamless syncing with other services like Oracle, QuickBooks, NetSuite, Sage, and Google.
- Industry-specialized HR professionals
- Varied benefits packages and administration
- Payroll processing
- Tax filing and W-2 preparation
- Training and development courses for employees
- Risk mitigation and liability protection
- Proprietary app for payroll, benefits, expenses, and time tracking
Currently, TriNet only works with businesses with at least five employees, so smaller businesses might want to consider an HRO solution from Bambee.
When working with TriNet, you’ll have 24/7, one-on-one support from their HR experts. As with every aspect of TriNet’s services, you can expect industry-specific knowledge that can help take your business to new heights.
Axcet HR Solutions offers a PEO solution that provides your company the benefit of structure and regulation. If your small business currently pays too much for health insurance, struggles with employee turnover, or needs a dedicated payroll administrator, the team at Axcet HR can help you build out a solution.
Axcet’s HR professionals can take on just about every facet of human resources, from recruitment to benefits administration and even termination. Highly skilled in the world of state and federal workplace regulations, Axcet’s team will also make sure that your teams abide by any government regulations.
Axcet’s PEO solutions, unlike those of an HRO, require you to partner with them, effectively making them into your co-employer. While this commitment may sound intimidating, working with an IRS-certified PEO (CPEO) like Axcet HR brings many benefits such as financial stability, industry experience, and organizational integrity.
Regardless of where your business is at in terms of growth, Axcet HR Solutions can partner with your organization to help develop and implement HR protocols that protect your teams and foster a culture of progress.
Axcet HR Features
- Recruitment and retention infrastructure
- Employee discipline and termination guidance
- HR policy development and implementation
- Leadership training solutions
- Payroll and tax administration
- Diverse range of employee health benefits
- Workplace safety audits and recommendations
- In-house workers’ comp claims team
Axcet HR Downsides
Axcet HR operates nationwide, but currently doesn’t take on clients in:
- New York
So if your company is based in one of these locations, choose another HRO provider from our guide above.
Axcet HR Value
The value of Axcet HR lies in their expertise. Composed of HR professionals from a wide range of industries, Axcet HR Solutions can consult with your business and devise a strategy that delivers winning results––both for you and your employees.
If your company is weathering an HR-related issue, then Insperity undoubtedly has a solution for it. By automating crucial HR processes through their HCM infrastructure, Insperity allows businesses to operate more efficiently.
When partnering with their team, you’ll have access to a network of HR, payroll, and benefits specialists. Spearheaded by your Insperity client success manager, this team can help you navigate the intricacies of your tailor-made HRO solution.
Besides their HR support and technology, Insperity really stands out with benefit offerings. While they’re not required––as Insperity packages can be customized to your liking––Insperity’s benefits administration rivals that of Fortune 500 companies, giving your small business the chance to attract the best talent in your industry.
Like other HROs, Insperity offers generous health, vision, and dental insurance. Insperity can help implement online benefits enrollment, data integration with carriers, and HSA, FSA, and HRA administration.
- Fortune-500 level benefits
- Proprietary HR platform that streamlines workforce management
- Access to HR professionals
- Intuitive self-service tools for employees
- HR administration
- Payroll administration
- Customized report generation
- Time and attendance management
- HR policy generation and dissemination
- talent acquisition, onboarding, and management
Insperity offers both PEO and HRO services; however, for those seeking a purely HRO contractor, it’s difficult to distinguish which of their offerings fall under this category. As with TriNet, businesses with five or fewer employees will want to seek a different solution.
With its comprehensive array of services, Insperity is the ideal HRO partner for small- to mid-sized businesses, particularly those looking to level up their benefits.
While the phrase human resources connotes compassion and humanity, few HRO services center on people in the way that BambooHR does. Built on a sophisticated software platform that gathers employee data at every stage of their growth, BambooHR provides you with the data needed to make strategic decisions for your company, decisions that spring from and serve your people.
The BambooHR approach begins with recruitment. Their software allows you to find top talent and then monitor candidates as they move through the hiring funnel, monitoring that continues throughout their employment life cycle.
Employees will appreciate the easy-to-use secure self-service portal where they can keep records, track hours, and submit requests for time off.
- Intuitive software platform optimized for smartphones
- Advanced people data, analytics, and reports
- Recruiting, hiring, and onboarding assistance
- Compensation tracking
- Performance management
- Employee satisfaction services
Ironically––considering the person-centered mission of BambooHR––you won’t find much in the way of human HR expertise. Rather, Bamboo HR is a software solution that can help offset the more menial HR duties, as well as aid in the acquisition and use of employee data.
While BambooHR doesn’t offer the more advanced features of its competitors, its software presents a simple and effective way to manage the work-life of your employees. BambooHR even offers a seven-day free trial period, making them one of the few HRO services that allow you to try it out before you commit.
|BambooHR Plan||Features||Monthly Cost|
|Essentials||HR Management, Employee Self-Service||$4.95 per employee|
|Advantage||Hiring / Onboarding, Advanced Reporting||$8.25 per employee|
- Time Tracking
- Performance Management
If one were to combine the intuitive software of BambooHR with the HR offerings of TriNet, you might end up with an HR outsourcing solution like Justworks. With plans that include benefits starting at $99 per month, Justworks is both accessible for small businesses and multi-faceted enough to serve larger organizations.
Their basic package includes payroll management, compliance assistance, and other expected HR tools. Their more robust Plus plan, however, includes COBRA administration, health advocacy services, medical insurance, and HSA/FSA accounts.
Regardless of which plan you choose, you’ll have access to hiring, onboarding, and workflow management tools that help your business scale faster.
- Medical, dental, and vision plans
- Proprietary HR tools for onboarding and PTO
- Organizational charts
- 24/7 HR consulting and support
- Employer tax forms and filing
- Automated deductions and direct deposits
- Workers’ comp, EPLI, and 401(k) services
- HR policy creation assistance
Despite the visual similarities to BambooHR, Justworks currently offers no companion smartphone app, meaning this PEO service is mostly confined to your computer.
The benefit of Justworks is its simplicity. From its software’s intuitive interface to the straitlaced pricing, this HRO service wowed us with its ease of use.
|Justworks Basic||Features Payroll, Benefits, HR tools, and Compliance|
|<50 Employees||$59/mo per employee|
|50+ Employees||$49/mo per employee|
|Justworks Plus||Plus Access to Medical, Dental, and Vision|
|<50 Employees||$99/mo per employee|
|50+ Employees||$89/mo per employee|
While a majority of HR outsourcing companies offer a mobile software platform, ExtensisHR centers their methodology on a “mobile-first” approach. With ExtensisHR, you can manage payroll, benefits, compliance, and recruiting––all through a smartphone or a computer.
Similar to other software-centered HROs, ExtensisHR emphasizes the importance of obtaining and tracking data, be it from workflows, HR practices, or peer reviews. By actively collecting this data, and presenting it in customizable reports, ExtensisHR enables your teams to make strategic improvements that lead to growth.
- HR guidance and support
- Benefit planning and consulting
- Employee benefits administration
- Risk management
- Automated job postings
- Integrated learning schedules for upskilling employees
- Dedicated customer service team
Unlike some other HROs on this list, ExtensisHR does not appoint a dedicated, industry-specific HR professional to your account. That said, the company does work with a variety of industries.
In alignment with their mobile-first ideology, ExtensisHR is an ideal solution for quickly growing businesses. In under 24 hours, you can get a customized quote and start using ExtensisHR for your HR needs.
Why Is HR Outsourcing Important for Small Businesses?
For small businesses, outsourcing HR can save both time and money. Particularly for organizations with neither the capital nor personnel to handle employee management, HR outsourcing provides an effective solution.
If your business currently struggles with the following issues, then consider outsourcing your HR.
Non-HR Team Members Taking on HR Functions
According to ADP, 70% of small businesses delegate HR tasks to team members with little or no experience managing workforces.
While this tactic might work in a pinch, it’s important to remember that HR professionals are an indispensable source of expertise in terms of both onboarding employees and continuing to manage them.
Insufficient In-House HR Team Members
HR outsourcing is not a one-size-fits-all strategy. In fact, with most HROs, you can select which specific HR processes you’d like to offload into their hands.
For example, if you’ve already got a team to handle recruitment and onboarding, you might call on an HRO to handle issues of payroll and employee benefits.
Lawsuits & Liability
HR professionals are an integral component of shielding your organization from employment-related lawsuits.
With an extensive knowledge of policies related to wrongful termination, discrimination, workplace harassment, and workplace injury, a dedicated HR professional can help ensure all aspects of your workplace are in alignment with both local and federal regulations.
Which HR Functions Can Be Outsourced?
You can outsource almost any component of human resources to an HRO. The following processes represent what you can expect from an HRO company, and some companies offer additional services.
Many new companies give little attention to human resources, but as your business scales, you’ll want to establish some protocols for employee conduct, communication, and training.
An experienced HR professional can help you establish these HR operations, creating an employee handbook, managing employee relations, and drafting policies specific to your company.
By outsourcing payroll processing, you can help make sure that employees are paid on time and that your company complies with local and federal payroll regulations.
Many HRO companies will also assist your business with filing taxes, getting tax credits, and handling workers’ compensation claims.
To attract the best talent, your company needs a compelling benefits package that––at a minimum––includes health insurance, retirement plans, and health savings accounts.
Many HR outsourcing companies can help you create and administer employee benefits, giving your workplace a competitive edge.
Talent Recruitment and Onboarding
For larger organizations, recruitment is a full-time commitment, one that requires full-fledged teams to both attract and onboard talent. Smaller businesses, however, often rely on their existing teams to take on these roles. If your company struggles to find and keep quality personnel, then an HR outsourcing company could take on these duties, creating a talent acquisition strategy, implementing an applicant management system, and developing onboarding practices for new hires.
Unless a member of your team is well-versed in issues of business compliance, then lawsuits from team members will pose a continued risk to your organization. To address this, an HRO company can assist you with both understanding and complying with federal, state, and local regulations that govern both employment and safety practices of your industry.
To help your business manage annual reviews, salary negotiations, and other conversations related to employee performance, an HRO company can step in. In most cases, you’ll want an in-house team member to lead these types of conversations, but an HRO professional can help you plan for them, aligning company goals with the expectations of individual team members.
No matter how healthy your workplace culture is, conflicts will inherently arise. Particularly for smaller companies in which leadership is diffused throughout the organization, handling these types of issues can prove difficult. HR outsourcing companies can provide you with an unbiased third party that can help mediate disagreements among team members. These companies can also help you create, implement, and update your employee handbook.
HRO vs PEO
Both HROs and PEOs (professional employer organizations) can help small businesses tackle HR-related issues; however, the two types of organizations differ in their approaches.
While an HRO company acts as a contractor, a PEO acts as a partner or co-employer, hiring its own employees, providing payroll services, paying taxes, creating W-2s, and managing any associated tax liabilities. When partnering with a PEO, your business handles business decisions and employee responsibilities, while the PEO handles all aspects of HR.
When compared to an HRO, the main differentiation with PEOs is that the PEO takes on the legal and financial responsibilities of your employment practices. PEOs often come with lower-premium health insurance and workers’ compensation plans, allowing smaller businesses to offer the competitive benefits packages of larger companies.
HROs and PEOs Compared
|Contract with your business and take on neither tax nor financial liabilities||Partner with your business and take on associated tax and financial liabilities|
|HR services in an “a la carte” pricing model||More fixed HR outsourcing packages|
|Lower cost||Higher cost|
|Less comprehensive benefits packages||More comprehensive benefits packages to employees|
What Is an IRS-Certified PEO?
An IRS-Certified PEO (CPEO) has met the rigorous standards for professional employer organizations. Currently, fewer than 7% of PEOs hold IRS certification. To qualify for this designation, a CPEO must:
- Have at least one physical business location in the United States.
- Demonstrate a history of financial responsibility, organizational integrity, and tax compliance.
- Be managed by a majority of U.S. citizens and residents with demonstrated expertise in employment tax compliance.
When the IRS designates a PEO as certified, it denotes a high degree of trustworthiness, minimizing the onus of financial risks in your partnership.
Final Thoughts on HR Outsourcing Companies
In 2022, the average salary for a HR specialist hovers somewhere near $50,000. But, unless your company has reached a point where it can foot the bill for this type of personnel––or potentially several––HROs offer a cost-effective way to protect both your employees and your organization.
When comparing quotes from HROs, be sure to consider which services they offer. Which duties could benefit from the work of true professionals? Although software can be a great way to track data, you’ll be happier working with an HRO that’s backed by humans skilled in the art of managing people.
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