With every business, the human resource (HR) professional or department provides a critical aspect of the strategic function of all HR activities and business practices. Understanding what HR does, and how it applies to employment, employees, and the company as a whole, is an important element of organization, structure, good workplace conditions, and maintaining legal compliance with a variety of laws.

While the traditional role of HR has been largely administrative, including recruiting and interviewing prospective employees, administering benefit plans, and writing policies, it is now understood that a HR department must be more involved, more proactive, and more in-tune with company policies, objectives, strategies, and organization in order to foster better growth and knowledge in each business’ particular market. Along with their administrative duties, many HR managers and specialists are now more involved in training, development, job analysis, oversight of workplace conditions, and mediation of disputes between employees and the company. A HR professional may also tend to workplace safety, privacy, and the prevention of discrimination and harassment. With this important list of duties, a strong HR manager is vital to a company’s success.

As human resource-related issues are ever-present, a HR professional is one of the ways to effectively and lawfully deal with company personnel, policies, paperwork, contracts, wages, audits, and more. While large companies have the budget for an internal HR department, many small companies opt to outsource these services, which generally fall into four categories: PEOs, BPOs, ASPs or e-services. The terms are used loosely, so it’s important to know exactly what the outsourcing firm you’re investigating offers, especially when it comes to employee liability. Whether a company is small and newly formed or is well-established with hundreds of employees, it’s vital to establish some formal aspect of HR responsibilities. This will help a company comply with basic legal and regulatory requirements, including employment and placement, compensation and benefits, training and development, job analysis, employee relations and activities, and more. Most importantly, these critical HR activities may help a company avoid employee dissatisfaction, litigation, government investigations, and work stoppages.

If it’s not already in place, now’s the time to start thinking about your HR department, activities, and personnel.