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Does a small business require HR?

By 22/06/2022HR Software
Does a small business require HR?

Human resource management is an incredibly useful tool for organising, managing, training and compensating employees. However, small businesses tend to have fewer employees and smaller budgets. So do they still need HR?

In this post, Natural HR will answer all your questions about small business HR. From legal requirements to how many employees justify an HR department, all the information you need is below.

Is it a legal requirement to have an HR department?

No, in the UK, you can choose whether or not you have an HR department or HR manager. If you do not have an HR department, your business will rely on managers to oversee hiring and promotions, workplace grievances, and establish workplace ethics and norms.

With the proliferation of efficient HR software, small businesses can now manage their teams efficiently, with nothing and no one falling through the cracks. 

How many employees do you need before you need HR?

When a business reaches between 15 and 25 employees, it is wise to invest in HR. You can start out small by hiring a consultant or a part-time HR employee. When you see the benefits that dedicated human resources offer your company, you will likely choose to scale up. However, there is no rush if you start by having HR software and then move on to a part-time employee, aided by the software that already has all of the information they require for success.

At what size does a company need HR?

As discussed above, hiring a human resource generalist or creating a department is dictated by employee numbers. When a business grows in numbers, products, and services offered, the need for an HR department will grow at the same rate. If your small business reaches about 50 employees, it is very important to hire a full-time human resource staff member. Otherwise, your company may struggle to continue running smoothly. 

Do all businesses need HR?

All businesses do need human resource management, but as we’ve seen, the basics of this can be done by managers in the company with the help of HR software. There is no doubting, however, that all businesses benefit from dedicated HR support. 

Human resources can help you monitor employee performance, absenteeism, recruitment, training and development, asset and employee management, and payroll. Having an expert to handle these important aspects in a business is very beneficial for both employees and the company. 

Do you need HR help?

If, after reading this, you’ve decided that your business could benefit from HR support, contact us today. From software to support, we are always ready to help companies to reach their full potential.

Natural HR

AboutNatural HR

Natural HR is a cloud-based HR software company for growing businesses with 100+ employees. Since launching in 2010, we’ve been building a comprehensive suite of HR functionality that equips the small to medium-sized enterprise with everything needed to build an effective and efficient HR operation.