What does an HR consultant actually do?

Running a small business means wearing every hat. HR often gets added to the pile quietly, until there is a problem that cannot be ignored. A staff dispute. An unexpected resignation. A disciplinary situation with no process in place. By that point, the question is not whether you need HR support. It is why you did not get it sooner.

This article answers the question honestly: when does a small business actually need an HR consultant, and is it worth the cost?

What does an HR consultant actually do?

An HR consultant provides the expertise and support that most small businesses cannot afford to keep in-house. Rather than hiring a full-time HR manager, you access that knowledge on demand.

In practice, this covers a wide range of work:

•        Drafting employment contracts and offer letters

•        Writing or updating staff handbooks and HR policies

•        Advising on disciplinary and grievance processes

•        Supporting with performance management and absence

•        Handling redundancy processes and settlement agreements

•        Keeping you on the right side of employment law as it changes

Some consultants work on a retained basis, giving you a set number of hours per month. Others work project by project. Both models work well for small businesses, depending on your needs.

When does a small business need an HR consultant?

There is no fixed rule, but there are clear signals that it is time to get proper HR support:

•        You are making your first hire and want to get contracts and onboarding right

•        You have had a complaint from a member of staff and are unsure how to handle it

•        You are growing quickly and people processes are not keeping up

•        An employee has been off sick for an long time and you are not sure of your obligations

•        You are considering a redundancy and need to follow the correct process

•        You simply do not have time to keep up with changing employment law

The most common mistake is waiting until something has gone wrong. Employment tribunal claims are expensive and stressful. Getting straightforward advice early almost always costs less than dealing with a dispute later.

What does HR consultancy typically cost?

Costs vary depending on the consultant and the level of support you need. For most small businesses, the options are:

•        Ad hoc advice: pay for what you use, typically by the hour

•        Retained support: a monthly fee covering a set level of access and hours

•        Project work: a fixed fee for a specific piece of work, such as a staff handbook or a redundancy process

Retained HR support is often more cost-effective than it sounds. Compared to the time spent dealing with HR issues yourself or the cost of a tribunal claim, the numbers tend to make sense quickly.

Is it better to hire an HR manager or use a consultant?

For most small businesses, an in-house HR manager is not the right move until you have significant headcount and ongoing HR complexity. The cost of a full-time hire, salary, employer National Insurance, pension, and benefits all add up fast.

An HR consultant gives you access to the same level of expertise without the overhead. You get someone who understands your business and can respond quickly, without the fixed cost of a permanent employee.

The bottom line

If you have employees, you need HR processes, even if they are simple ones. The question is not whether to take HR seriously, but how to get the right support for your stage of growth.

Swan HR works with start-ups, small businesses and growing teams across London and the South East. If you are not sure where to start, a conversation costs nothing.

Find out more about our HR support for small businesses or get in touch to discuss your situation.