For many small business owners, the human resources branch is a task handled on the side. Maybe it’s a finance manager doubling as the HR person, or the owner trying to keep up with hiring and also running daily operations. As your business grows, so does the complexity of managing people and that’s where fractional HR comes in.
Fractional HR is flexible and cost effective for companies that need HR expertise but aren’t ready to invest in a full-time department. It gives small and mid-sized businesses access to experienced HR professionals on a part-time or as-needed basis.
Read on for more information about fractional HR, how it can help your business, and whether you need it at all.
What Is Fractional HR?
Fractional HR is when a business hires an HR professional or team to provide support on a part-time or as-needed basis. This may equate to a few hours per week, help during a growth phase for the company, or support during specific challenges like updating the employee handbook or compliance audits.
Your fractional HR person can manage everything from recruiting and onboarding to employee relations, benefits administration, training, or compliance all without the financial overhead of a full-time person.
It’s an ideal solution for businesses in an in-between stage that are too small for a full HR department but too large to leave HR in the dust.
Why Fractional HR Works for Small Businesses
1. You Gain Expertise Without the Full-Time Expense
Hiring an experienced, full-time HR professional comes at a cost that may exceed a six-figure range. For small businesses, that simply may not be feasible.
Fractional HR provides access to seasoned consultants who already know how to handle compliance, policy development, employee issues, and more. You get the benefit of their knowledge without the full-time price tag.
2. Scalable to Your Business Needs
Need help for a busy quarter? Want to overhaul your onboarding experience? Navigating a tricky employee issue or preparing for an audit?
With fractional HR, you can scale support up or down depending on your unique needs. You won’t be paying for hours you don’t use or scrambling for help when things become overwhelming.
3. Reduced Risk of Compliance Issues
HR compliance is about protecting your people and your business reputation. Employment laws change frequently at the federal and state level, and it can be overwhelming to try to keep up.
A fractional HR consultant brings real-world knowledge of changing laws and best practices. They can help ensure you’re in compliance with everything from the Fair Labor Standards Act (FLSA) to the Pregnant Workers Fairness Act, ADA, EEOC, and beyond.
4. Focus on Core Business Growth
HR takes time. Between writing job descriptions, responding to employee concerns, managing benefits, and conducting reviews, your team can get overwhelmed and burnt out with this type of work.
With fractional HR support, your leadership team can focus on growing the business, while your consultant handles the behind-the-scenes processes that keep your workforce healthy and operating smoothly.
What Services Can Fractional HR Include?
Fractional HR services can cover a wide range of responsibilities, depending on the specific needs of your business. Some companies need help with day-to-day tasks, while others turn to fractional support for strategic planning or one-time projects. Common areas of support include:
- HR audits and compliance reviews
- Employee handbook development and updates
- Compensation planning and wage analysis
- Employee relations and conflict resolution
- Training and development programs
- Recruiting and on-boarding support
- Affirmative action planning
- Performance management systems
- Strategic HR planning for growth and retention
Whether support is needed a few hours a week or during a key transition period, fractional HR offers flexible, targeted assistance that adapts to the changing needs of your business.
When Should You Consider Fractional HR?
Not sure if it’s the right time to bring in a fractional HR partner? Here are a few signs:
- You’ve grown past 10+ employees and need formal policies
- You’re facing compliance concerns or recent legal changes
- You’ve experienced employee turnover or morale issues
- You’re expanding, hiring rapidly, or opening new locations
- HR responsibilities are taking time away from leadership tasks
- Your employee handbook is outdated or non-existent
Even if you’re not ready for full-time support, bringing in a consultant for a few hours a month can create structure, reduce liability, and improve employee satisfaction.
Fractional HR: Not Just a Quick Fix—A Strategic Investment
One of the most common misnomers about fractional HR is that it’s just a temporary fix. But in reality, it’s a sound investment in the future of your company.
You aren’t just outsourcing a task or putting a bandaid on a problem, you’re building a resilient business. With the right HR systems in place, you can retain better talent, reduce compliance risks, create a healthier workplace environment, and prepare your business for growth.
At Seay Management Consultants, we’ve worked with hundreds of small businesses to provide this exact type of tailored, expert support.
Ready to Learn More?
If your business is in that awkward ‘in-between’ phase where you’re outgrowing your current team and business model, we are here to help. Whether you need a few hours a month or a more hands-on hourly partner, Seay Management Consultants can tailor an HR strategy that fits your unique business needs.
Contact us today to discuss your HR options.
