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The implications of not having an HR for your organisation

The human resources department oversees the administrative functions within any organisation. This department is entrusted with the responsibility to manage payroll and benefit administration, recruitment and employee relations. The HR Team  acts as a liaison between workers and management. The department also maintains relationships between employers and labour unions.

When it comes to delegating tasks and developing roles in a firm, the human resource (HR) department and the guidance of an HR professional is a must. Most companies either employ a small team dedicated to HR or have one individual to keep its elements running smoothly. Other businesses outsource the HR model and have an expert who deals with employee issues when they arise. In other cases, a business may designate a staff to handle HR duties in addition to their role. HR professionals manage a business’s most vital part: the people. From compliance issues and regulations to engaging, developing, and hiring employees, HR is essential as it helps companies stay ahead of competitors in today’s ever competitive world. 

Lets see the implications of running a business without HR by presenting the possibilities of litigation, risks of fines and non-compliance issues with specific government agencies, and low workforce morale and turnover issues. From a business view point, the absence of HR puts businesses at the possibility of violating several employment laws.

Ineffective Recruitment 

The human resources department typically handles an organisation’s recruitment drive. The department works with managers to determine hiring needs as well as to interview and assess the skills of potential candidates. A poorly planned hiring or unstructured hiring  practice may lead to the employment of unqualified and inept workers.The HR department not only plans practical strategies in hiring and absence of this could impact the integrity of the workforce. 

High turnover rates

Human resource management failure directly affects employees. Without proper human resource management, employee dissatisfaction would remain unnoticed. As a result, employees might end up seeking employment elsewhere. Then an effective exit interview with a qualified HR professional is essential in addressing their motivation for quitting. If this meeting doesn’t occur, there is no one to pass on the valuable information and serious company issues could go unresolved. This presumably leads to high turnover rates.


The HR department ensures a company complies with employment and labour regulations. Equal employment opportunity laws, the Family and Medical Leave benefits are a few of the comprehensive and complex regulations about which the HR department must remain in sync with. A department that poorly plans the legal aspects of the workplace could negatively impact an organisation’s good standing and reputation even in the short run.

Low morale 

An ill structured HR practice will likely spread to impact all levels of the organisations. Such negative impacts may include employee conflict, lack of recognition, inadequate training, and poor team building among other issues. Due to the lack of an effective HR management strategy, employees may feel that such negative situations will not improve. This will damage workplace morale on the whole. 

Lost business 

Job satisfaction of employees plays a large role in its success. If employees are constantly quitting or being unproductive due to a negative work environment, the business loses time and money. Also the organisation will  have to frequently undergo the training and hiring process all the while losing people with specialised skill set from the organsation.

Legal issues 

HR is often largely responsible for ensuring that a company complies with employment and labour regulations. They also craft policies that prevent employees from unfair treatment. To avoid employees from feeling like they were victims of wrongful termination, harassment, it is important to have a policy that prevents such issues. If organisations don’t clearly write, distribute, and update their policies properly, they could face a serious legal problem in the case of an incident. 

Once an organisation has reached a certain complexity by terms of growth, the risks of not having an HR department can increase substantially. Regardless of how good an organisation is at managing employees, when it comes to dealing with recruitment, conflict resolution and legal responsibilities the role of HR becomes indispensable. Having an HR department not only helps to resolve and prevent issues with employees, but helps to build trust and security, improving retention and recruitment. 



A seasoned professional with more than 2 decades of experience in collectively working with various ministries of the Government and well networked amongst various Government departments and the officials in various sectors. With the urge to streamline processes for organisations founded Versutus management services Private Limited, an organisation growing tremendously in the fields of compliance and management services with its clientele across manufacturing, logistics, Warehousing, IT & ITES. The confidence and trust of their clientele speak volumes about "Versutus" under the leadership of "Ramji"

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