Why You Shouldn’t Be Your Own HR Department

Let’s say your family doctor hears a strange clicking under the hood of his car. Does he grab a wrench and dive in? Probably not.

He takes it to a mechanic - someone trained to spot the problem and fix it right the first time.

But every day, I see smart, capable small business owners trying to troubleshoot HR problems they were never trained to handle.

The marketing pro managing employee issues without clear policies.

The tech founder unsure how to legally pay a contractor.

The restaurant owner tangled in labor laws she didn’t even know existed.

It’s not about smarts or work ethic - it’s about expertise. HR is its own beast. And when you try to DIY it, the cost isn't just time (though there’s plenty of that). It’s compliance risks, employee turnover, and the mental load of constantly feeling unsure.

This isn’t about scare tactics either. It’s about being honest: HR is already happening in your business. The question is whether it’s happening intentionally or by default. And if it’s the latter, it might be slowing you down more than you think.

Let’s look at the real cost of doing it all yourself, and what can change when you stop.

When a business owner tells me, “I just do the HR myself, because it saves money,” I get it. On the surface, it seems like the scrappy, boot-strapping, budget-smart thing to do.

But here’s the catch: like that doctor fixing his own car, the upfront savings can lead to bigger problems - and more expensive ones down the line.

If you’re handling HR on your own, chances are you’re spending more time on it than you realize. In businesses with fewer than 20 employees, I often see owners sinking 7–10 hours a week into HR tasks.

That’s a full workday, every single week, spent on:

Figuring out labor laws

Writing and updating policies

Processing payroll

Navigating employee issues

Posting jobs and doing interviews

Trying to resolve performance problems

Now imagine what else you could be doing with that time. That’s where the real cost shows up.

Those hours aren’t just time - they’re opportunity. What could you build if you got a full day back every week?

Could you land another client?

Nurture key partnerships?

Launch a new offer or product?

Finally step out of the weeds and into your role as a true business leader?

If you typically generate $150/hour in your core business activities (a very modest estimate), you’re potentially leaving $1,000+ on the table every week. That’s $50,000–$75,000 a year you’re not capturing, because you're tied up in paperwork and compliance.

Here’s where it gets risky. HR mistakes can be expensive - and I’m not just talking about big lawsuits. I’ve seen small businesses get hit with penalties for things like:

😬 Misclassifying employees or contractors (hello, $1,200 per person)

😬 Missing or incomplete I-9 forms (up to $2,300 each)

😬 Forgetting overtime rules (double back pay + damages)

These aren’t rare. They’re common. And it’s rarely because an owner is careless - it’s usually because they didn’t know. Unfortunately, “I didn’t know” doesn’t hold up in an audit.

Here’s another hidden cost: the employee experience. When HR is handled ad hoc, it often leads to:

❌ Policies that aren’t consistent

❌ Pay structures that don’t make sense

❌ Performance reviews that feel confusing or reactive

❌ Culture that doesn’t feel intentional or inclusive

Even if you care deeply about your people (and I know you do), that care doesn’t always translate into a great employee experience without the right systems in place.

And that affects retention. One avoidable resignation can cost $10,000+ in lost productivity and rehiring costs. Multiply that by a few departures each year, and it adds up fast.

Let’s go back to that doctor and the car for a second.

He’s smart. He’s capable. Could he learn how to fix an engine? Sure. But does it make sense for him to spend hours Googling, buying tools, and troubleshooting a problem that someone else could solve in a fraction of the time (and with way less stress)? Probably not.

Same goes for HR.

Small business owners are incredibly smart and resourceful. But HR is one of those things that looks simple - until you’re knee-deep in it and realize you’re in over your head.

HR isn’t just about having a handbook or processing payroll. It’s a full-on discipline that touches nearly every part of your business:

🔸 Employment laws (federal, state, and local—many of which conflict with each other)

🔸 Hiring and onboarding

🔸 Pay and benefits (and making sure they’re done right)

🔸 Employee performance and development

🔸 Handling sensitive issues

🔸 Creating culture and structure

🔸 Managing risk and documentation

And every one of those areas comes with best practices, legal requirements, and gray areas that take years to fully understand. Mistakes here don’t just create inefficiency - they can trigger financial and legal headaches you didn’t see coming.

One of the biggest risks with DIY HR? Not realizing there’s a problem until it’s too late.

I know of a company that had grown to nearly 20 employees before learning they were supposed to be offering FMLA protections. It wasn’t that they didn’t care - it just wasn’t on their radar. That realization came after a complaint was filed.

It’s that kind of stuff that keeps business owners up at night. You can’t protect your business from what you don’t know exists.

“We’re small—no one’s going to come after us.”

→ Actually, small businesses are more likely to be audited or sued because they’re less likely to have strong compliance systems in place.

“We treat employees like family—we don’t need all the formal stuff.”

→ I get that. But when you treat one “family” member differently than another, you open yourself up to discrimination claims, even if your intentions are good.

“I found some templates online—that should be fine, right?”

→ Templates are a starting point, not a solution. They rarely account for your state’s laws, your industry, or the nuances of how you actually run your business.

“HR is just admin work—anyone can do it.”

→ HR done right is strategic. It helps you hire better, retain great people, avoid costly mistakes, and scale your team with confidence.

Up to this point, we’ve been talking about the costs of trying to do it all yourself. But here’s the other side of the coin - what changes when you get the right support in place.

Because HR isn’t just about avoiding risk. When done well, it actually helps your business grow.

When HR is set up the right way, it stops being a burden and starts becoming a growth tool. Strategic HR gives you:

✓ Better hiring processes

✓ Faster, more effective onboarding

✓ Clear performance expectations

✓ Pay structures that actually motivate people

✓ Proactive compliance support

✓ A stronger workplace culture

That’s not just admin - that’s smart business strategy.

You get time back.

The average owner gets 7–10 hours a week back when they stop handling HR themselves.

Your hiring gets better.

Structured recruiting means fewer mis-hires, better team fit, and less turnover.

Your risk goes down.

A pro keeps an eye on compliance so you don’t have to.

You build for scale.

With HR systems in place, you can grow without chaos.

Professional HR support typically pays for itself many times over in:

✓ Time saved

✓ Legal risk avoided

✓ Better team performance

✓ Lower turnover

✓ Increased capacity to grow

In many cases, the return on investment is 2x, 3x, or more.

If any of these sound familiar, it might be time:

• You’re spending more than a few hours a week on HR

• You’ve had employee issues that felt unclear

• You’re constantly stress-Googling HR stuff

• You’re hiring or growing and unsure what’s required

• You’ve had a “what now?” moment around payroll or performance

This doesn’t mean you’ve done anything wrong. It just means it’s time to upgrade how you’re handling HR.

HR is happening in your business whether you’re being intentional about it or not.

You don’t have to be the doctor fixing his own car. Your time is too valuable. Your business is too important. And your employees are too essential to wing it with people management.

Let’s talk. You can book a free 30-minute consultation to explore how HR support can help your business grow.

No pressure—just a real conversation.

👉 Schedule your call here

What HR task would you outsource first? Drop a comment below 👇