As businesses grow, so do their needs when it comes to human resources. The more people you bring into the team to empower your customers, the more tedious the task of managing them becomes. It’s inevitable. It’s just a natural consequence of growing.
For most organizations, this could pose a challenge. After all, HR comes with a huge administrative burden: from recruiting to employee training to ongoing employee relations. While business growth is of course a good thing, having systems in place to control, maintain, or escalate this — whichever your goal may be — is important to protect both your business and your people through efficient and effective HR operations.
This is why HR Outsourcing is often seen as an ideal option for businesses that need to scale.
There are a number of good reasons behind this. It’s not a coincidence that most businesses (around 42% of them) today have outsourced at least one HR function. And if you’re reading this, there’s a huge chance that joining these businesses who have utilized HR outsourcing has crossed your mind.
If that’s the case, you’re in the right place. In this article, we’ll quickly cover the things you need to know about HRO, the factors you need to consider when outsourcing HR functions, the top companies you can choose from AND how you can choose the right HR outsourcing company in the Philippines to work with.
Ready? Let’s start with the basics.
What Is HR Outsourcing?
Let’s start by breaking down the two elements of the concept: HR (human resources) and outsourcing.
Human resources — that’s something you’re already familiar with. Since you’re managing a business, we could say that it’s somehow part of your daily routine and be right. It’s that business function where, as an employer, you manage your people. Outsourcing — you’ve probably heard of as well, maybe more than once — from colleagues, competitors, all over the internet through articles like this one. It’s the process of partnering with an external service provider to delegate some of your core business functions.
The combination of these two is a fast-rising industry valued at $39 billion: HR Outsourcing.
HR outsourcing (HRO) is a business strategy that involves enlisting the services of a third party agency or individual to manage some or all functions of one’s human resources. Most companies that outsource HR functions do so to access specialized talent, improve operational efficiency, as well as reduce costs. In essence, you'll be hiring an HR professional (or a team of HR specialists) through a third-party provider to handle your business' unique HR needs.
The most commonly outsourced HR functions are recruitment and talent acquisition, compensation and benefits, payroll administration, employee training and development, and HR compliance. It really depends on the specific needs of the business; you might just need assistance with payroll, some guidance with talent management, maybe an HR platform to help you get valuable insights from employee data, or an entire department of HR experts — it’s totally up to you.
Like many other business processes, HR is being outsourced more and more due to financial constraints and talent shortage experienced by global companies. This makes outsourcing HR to offshore destinations like the Philippines a more compelling prospect for growing businesses, especially given the country’s reputation for high quality service and large talent pool, with a much lower cost.
Now that we have clarified what HR outsourcing is, let’s talk about the key things that you need to consider in order to make informed decisions when choosing an HR outsourcing company (we’ll drop the list in a bit) in the Philippines.
What Factors Should You Consider When Choosing An HR Outsourcing Provider?
Not all HR outsourcing companies are created equal — because if they are, then there is no discussion to be had, you can just pick any HR outsourcing company. However, this being a business investment, the right partner can transform your HR operations, while the wrong one may cause delays, inefficiencies, and compliance risks.
Here are the key factors to evaluate before making your decision:
- Range of Services
Check whether the provider offers the HR functions you actually need — be it payroll administration, recruitment, training, or talent management. Note that some companies specialize in one area, while others provide end-to-end HR solutions.
- Industry Expertise
Every industry has unique HR requirements. For example, retail companies may need seasonal hiring support, while healthcare organizations must comply with strict labor regulations. Choose a provider that is familiar with your sector and has previously worked with other businesses in your space.
- Technology and Tools
Modern HR outsourcing goes beyond manual processing. Ask about the HR software, automation (whether they’re adopting AI to streamline processes), and reporting tools they use to manage employee data while ensuring efficiency and transparency.
- Scalability
Your HR needs today might look very different in a year or two. That’s just how it works for growing businesses. So, consider your long-term goals and pick an outsourcing company that can grow with you, offering flexible contracts and the ability to scale HR services up or down as needed.
- Compliance and Data Security
HR always involves sensitive employee data. As such, it’s important to ensure that your outsourcing partner has strong data protection measures in place and complies with relevant laws and policies such as GDPR, HIPAA, or local labor codes.
- Cultural Fit and Communication
Smooth collaboration depends on more than technical skills. When hiring an HR professional, it also matters how they are going to connect with your existing team. So, when choosing a provider, consider whether the team understands your company culture and whether communication styles align with your in-house staff.
- Cost vs. Value
Remember: the cheapest option isn’t always the best. You want value for money and maximum ROI for outsourcing, not just mere cost savings. Compare pricing structures, but also weigh the value they bring in terms of quality, reliability, and long-term partnership potential.
Now, with these in mind, we have compiled a list of top HR outsourcing companies that excel in most, if not all, of these factors.
Let’s go ahead and get to know the leaders in the HR outsourcing space in the Philippines.
The Best HR Outsourcing Companies In The Philippines
For those considering outsourcing human resource functions to the Philippines, below are 10 of the top HR outsourcing companies or agencies, listed in no particular order, selected based on their online reviews and reputation on Google.
1. KDCI Outsourcing
A global outsourcing company that offers tailored HR outsourcing solutions, encompassing processes such as recruitment, payroll, training and development, etc. They specialize in building offshore HR teams that can seamlessly integrate with in-house teams in the US, Australia, and UK, highlighting seamless collaboration and smooth communication.
Given their wide array of human resources outsourcing services and that majority of their clients are medium sized companies, we recommend them for SMEs who prioritize a good fit when it comes to their offshore HR staff, and those who plan to expand their outsourced human resources to other areas like graphic design, Ecommerce, and customer service in the future.
2. One Outsource Direct Corporation
A BPO company that offers comprehensive HR outsourcing services with focus on innovation and adaptability. Their tailored HR solutions aim to enhance business operations and productivity with over 200 full-time passionate employees and working with various industries such as retail, energy, fashion, real estate, and food.
Their expertise in handling end-to-end HR functions, coupled with their consulting and technology services, makes them an ideal choice for businesses seeking to not only manage their HR operations but also to innovate their business practices with consulting and technology.
3. iSupport Worldwide
A BPO company providing various HR services, such as compensation & benefits, employee experience, and HR management. Their high-quality, cost-effective services help businesses scale their operations efficiently, while their team of experts work closely with clients to understand their specific needs and provide customized HR solutions that enhance productivity and operational efficiency.
With a strong track record in supporting various business functions, iSupport Worldwide is for SMEs looking to streamline their HR processes, especially those that require customized solutions to enhance productivity and operational efficiency.
4. Manila Recruitment
A premier recruitment firm specializing in executive search and HR outsourcing services, offering tailored solutions to meet the unique needs of their clients. They source high-caliber talent for executive, technical, and specialist positions, and have a dedicated team of consultants working closely with clients to understand their specific requirements and deliver candidates that fit their organizational culture and business goals.
Their expertise in headhunting and strategic HR support makes them a valuable partner for businesses seeking to drive growth and competitiveness through effective talent acquisition and management. We recommend Manila Recruitment for companies looking for expert recruitment services and strategic HR support
5. MCVO Talent Outsourcing
An outsourcing company that provides a wide array of HR outsourcing services, including recruitment, payroll, and employee management. They focus on delivering personalized solutions that cater to the specific needs of their clients. With a commitment to excellence and a client-centric approach, MCVO Talent Outsourcing ensures seamless integration of their services with clients' existing operations.
As they customize HR solutions, they can make great partners for SMEs looking to optimize their HR processes, improve efficiency, and achieve significant cost savings, particularly, for those seeking reliable and efficient HR services that support their growth and operational goals.
6. ConnectOS Philippines
An outsourcing firm offering comprehensive HR outsourcing services, specializing in recruitment, payroll, and employee benefits administration. They provide scalable solutions designed to integrate smoothly with clients' in-house teams, ensuring efficient HR operations. ConnectOS is known for its ability to deliver high-quality HR services that enhance productivity and reduce operational costs.
They build dedicated offshore teams, making them an ideal choice for businesses looking to enhance their HR functions while focusing on core activities. We recommend ConnectOS for companies seeking flexible and efficient HR solutions that support their long-term growth and success
7. Circa Logica
Circa Logica Group is a renowned provider of HR outsourcing, corporate training, and payroll processing solutions. Their HR services focus on recruitment, outsourcing, and consulting, helping businesses streamline their HR functions and improve operational efficiency.
With a strong reputation for service excellence and a client-centric approach, they are recommended for clients seeking to optimize their HR processes and achieve significant cost savings while maintaining high standards of service and support
8. Sourcefit
An outsourcing company that offers a wide range of HR outsourcing services, including recruitment, payroll, and employee benefits administration. Their dedicated team works closely with clients to understand their specific needs and deliver tailored HR services that enhance productivity and support business growth.
With their client-centric approach and extensive industry experience, they are a good choice for companies looking for reliable and effective HR outsourcing solutions that align with their strategic goals.
9. Staff Outsourcing Solutions
Staff Outsourcing Solutions specializes in HR outsourcing, particularly on bookkeeping, accounting, and back office services. They focus on providing high-quality, efficient solutions that cater to various industries.
With a commitment to customer advocacy and operational efficiency, Staff Outsourcing Solutions helps businesses optimize their HR functions and improve overall productivity, making them ideal for businesses seeking reliable and cost-effective HR services that support their long-term growth and success.
10. ADP
An HR outsourcing company that offers services such as payroll and tax processing, benefits management, and time and attendance HR software. Their service emphasizes automation and its role in enhancing their services.
As they’ve worked with brands in multiple geographies such as Latin America, North America, and Pacific Rim, and have partnered with small and large companies, they are a great choice for businesses who are interested in automation and have a global presence.
Now that you already have a list of options, the next step in outsourcing your HR function is to see which one perfectly matches your specific HR needs.
If you’re wondering where to start or still have more questions about how HR outsourcing works or how it can benefit your business, that’s where we can help. Simply reach out and we’d be happy to discuss any concerns you might have about human resources outsourcing.
Outsource Your HR Operations To The Philippines with KDCI.
There’s a reason why more and more companies outsource HR services to the Philippines. With its lower labor costs, high English proficiency, and large talent pool, brands across the globe are enjoying cost reductions, operational efficiencies, and high-quality HR services.
But with plenty of companies to choose from, which HR outsourcing company should you work with?
At KDCI Outsourcing, we’ve had over a decade of experience supporting brands, not merely as service providers, but as business partners who help our clients identify their objectives, strategize, and achieve their goals. Through our tailored outsourcing solutions, we can build you a winning offshore HR team in the Philippines that will not only meet your expectations, but seamlessly integrate with your inhouse team environment and culture, ensuring the best fit and smooth collaboration.
Interested in outsourcing HR services to the Philippines? Contact us today!
