Perks People Solutions director Cecilia White says “an enormous number” of small and medium enterprises in Australia operate without a formal human resources department.

This is unsurprising given around 70 per cent or 1.4 million businesses nationally are family run.

White, whose background is in employment law, says for these businesses the HR function will often sit with a family member who is also a senior manager.

She also notes that growing enterprises may not prioritise this function as they deal with day-to-day operational matters.

White appreciates this thinking, but says there can be significant risk involved and that outsourcing HR delivers on its investment, even for small businesses.

“We buy them back time. People management and any sort of HR issue does take a significant amount of time,” she explains.

“This is particularly true if you’re unfamiliar with workplace laws. You can spend a disproportionate amount of time researching if you’re unfamiliar with their intricacies.”

With the Fair Work Act and the award system becoming more complex in recent years, White says businesses may also unintentionally put themselves at risk.

Perks People Solutions has been working with local food manufacturer Nippy’s since 2015, initially helping with HR compliance across their four sites in Adelaide and The Riverland.

At the time, Nippy’s joint managing director Ben Knispel was overseeing most of the HR responsibilities, which was taking away from his focus of running the business.

“The service is ideal for businesses like Nippy’s, as we don’t have a dedicated internal HR resource,” shares Knispel, whose company was already using Perks for accounting and tax advice.

White recalls that the nature of the business had changed considerably over the years. “They were navigating three or four different awards across their sites.”

The initial tranche of work prioritised an audit of the company’s HR documentation: reviewing and updating all workforce contracts and position descriptions, and auditing the payroll to ensure everyone in the 200-plus workforce was being paid appropriately and was classified against the correct award.

Since then, Nippy’s has moved on to use Perks HR On Demand™. The service offering spans everyday matters, such as HR documentation and manager training, to misconduct investigations and terminations.

For Knispel, it has been a game changer.

“People can sometimes be the hardest part of a business, but having support with everything from recruitment to performance management, position descriptions and contracts has made life a whole lot easier,” he says.

White believes the upskilling of managers at the four sites has been of particular benefit to the company, saying, “the real value is in the increased capacity of managers to manage delicate issues in a best practice, compliant manner.”

“The skill level of the managers has improved greatly, compared to when we first came on board. It’s clear they have better systems in place, with checks and measures to ensure procedures are followed.”

White says these kinds of improvements are invaluable, as they also raise the overall professionalism of an organisation.

Like a regular internal HR department, Perks’ outsourced HR also provides support to employees, who are able to contact the team directly at any time. This also gives a level of independence or an external perspective that an internal HR manager may not have.

White says that the HR On Demand™ service is available to all businesses, not just existing clients of Perks, and that even the smallest ones will benefit.

“We’ve found the real value in what we do is that we’re not just a 1800 hotline number. We really do get to know the people within the business and we take every opportunity we can to be there on-site to have these conversations,” she says.

“I’ve worked with organisations where there’s only five employees – but they’re still looking for help and for support.

“Sometimes, it’s just as important in smaller organisations.”