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Why You Need an Human Resources (HR) Department, Especially as a Small Company

by: Amber Peoples, President, Atlas Services   March 4, 2022

Having an HR department to oversee the employee relations and benefits of your company is an important part of having a healthy business, whether you’re just starting out or you’ve been around the block a few times before. It can seem like an unnecessary expense at first glance, but when you consider the cost-savings in employee turnover and reduction in benefits claims, as well as the additional funds your business saves in taxes, you’ll realize that your HR department helps more than it hurts. Human Resources is a key element in any company. HR is not just for big companies. HR can help you hire the right people and keep them happy.

Human Capital Value

Human capital is a term that’s used to describe employees—and it has value. According to The Wall Street Journal, human capital accounts for more than 60 percent of corporate profit. In other words, companies with happy employees make far more money than their counterparts. As such, hiring and training employees isn’t just something we should do because it’s nice—it also makes good business sense.

The cost to hire new, or replace existing staff members, including training and ramp up time, can be exorbitant, especially for small businesses. Starting with the recruiting/hiring process, transitioning to employee retention focus, and at times offboarding of employees, each process is vital to the employee relationship and culture of a company.

Recruiting The Right People

If you’re going to build a winning team, it’s important to recruit great employees—people who will be good fits for your company culture and who share your vision. That said, don’t rush into hiring them right away. While there are no magic numbers, experts recommend you wait anywhere from one to three months before formally offering someone a job; during that time, you can learn more about them (and vice versa) through interviews and observation.

Onboarding Employees

How to get them excited about your company from day one and keep them engaged for life. If you’re not offering your employees a great onboarding experience, you are probably costing yourself a lot of money. The cost of time spent to train and monitor work during an employees training period, which, depending on the industry, can be a matter of days, several months, or even a full year. The first step to make sure that you don’t lose your best employees is by hiring them properly. This means knowing exactly what makes them tick and knowing how much they need to be paid.

Employee Retention

Inevitably, your best employees will be contacted by recruiters. An HR department can work with you to create a package that entices them to stay. If you don’t have enough money in your budget to keep these talented people onboard, then you will have to let them go and start fresh. However, not all employees are motivated by money. An HR department can get to know employees to figure out how they are motivated and find out the reason they considered offer. It could be minimal, such as the new company offers the ability to work from home occasionally or has a retirement plan.

The cost of retention can be far greater than it would take to keep them in your company, so it’s worth investing in their happiness. If you find that a certain employee isn’t a good fit for your company, then let them go quickly and make sure that they know why. Employers must work hard at avoiding bad hires; you want to retain only those candidates who are determined to stay on with your company and continue growing with it. After all, we want people who actually want to work with us. It is important to understand why employees are leaving so possible policy revisions or additional benefits can be established in order to retain current staff.


Atlas Services can be your outsourced human resources department.  Reach out to us today to learn more.

Want more information? Call/Text Amber Peoples at 720-577-4920 or email at or schedule a Zoom meeting.

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