Thursday, April 10, 2014

Eliminating HR Problems by Eliminating HR?

New ImageThanks to Liz Tippett for alerting me to the WSJ article on firms getting leaner and meaner by eliminating HR.   Liz comments that it reminded her of what she would say to grumpy corporate clients – "the only thing worse than calling your employment lawyer is not calling your employment lawyer."

In an era in which "compliance" is increasingly important for more and more employers, it is truly remarkable to discover that a department whose mission includes compliance with complicated labor and employment regulations is being phased out. And, if the article is to be believed, not merely at smaller firms.

I'd say that the article views the trend -- if such it be -- with suspicion. While outsourcing many of the mechanical operations of HR is much easier today with technological advances, it remains true that both managing "human resources" and complying with the law requires a more sophisticated understanding of both than a typical outside firm can provide.

But maybe I shouldn't complain. Savings on the front end with HR departments may generate more lawyers' fees on the back end, which has its advantages for law schools and the legal profession in this market.


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I would say this speaks volumes of gutted laws and worker hostile courts. HR? Why bother?

Posted by: Michael Duff | Apr 11, 2014 5:11:56 AM

I don't think getting rid of HR all together is always the right solution. Maybe it might be easier for a company to seek HR assistance from a second party, but either way issues will arise. It is essential to have the right tools and solutions at hand, so these issues can be taken care of properly.

Posted by: Ellyn Rosenthal | Apr 16, 2014 1:22:46 PM

What's also troubling but not being discussed is payroll companies providing HR services that often cross the line into providing legal advice.

Posted by: Gianfranco A. Pietrafesa | Apr 18, 2014 4:00:19 AM

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