Hudson Insight Series: A Guide to HR Contracts

Published27th July 2021 AuthorJohn Hudson

Tendering for HR contracts

Tendering for HR contracts provides opportunities for HR businesses of all shapes and sizes to add to their revenue streams. The process (especially in the Public Sector) is a fair, unbiased approach for the procuring and sourcing of work, goods or services. Prospective suppliers must ‘bid’ for this work, most notably through the submission of an SQ and ITT. You can find further information on the ins and outs of tendering on our sister website, Tender VLE.

Stages of Tendering 

  • Selection Questionnaire (SQ)

Also known as a Pre-Qualification Questionnaire (PQQ), the SQ typically acts as the first stage in the tendering process. Enabling buyers to sieve through prospective suppliers and decide which organisations have the capacity to deliver upon the requirements of the tender documents. SQ’s allow your business to demonstrate their compliance with the relevant legislation. You can provide previous examples of similar contracts that you have delivered. The SQ is similar to an application form. It will not win you the work outright, but a successful submission will certainly propel you to the next stage.

  • Invitation to Tender (ITT)

ITT’s provide suppliers with the opportunity to submit a much more detailed, all-encompassing response to the set requirements. ITT’s can be released alongside SQs, or withheld until after the prospective supplier passes the SQ stage. In response to an ITT, suppliers must provide answers to a range of quality questions. This is to demonstrate their technical capacity to deliver the contract. In addition to this, they must almost always have to submit a pricing schedule. Suppliers must price the work involved in the contract, as per the buyer’s guidance.

Winning ITT submissions will prove to be the most economically advantageous tender for that buyer. This is based upon a combined assessment of their technical capacity and pricing. Typically, HR contracts weigh heavily toward favouring technical capacity. Meaning ITT responses in this sector are typically weighted 60/70% toward quality, with the remaining 40/30% determined by the pricing.

Types of HR Tenders

HR contracts cover a broad range of services such as:

  • National and international recruitment,
  • Employee training programmes,
  • and performance management, to name a few.

The need for these services only continues to grow, as more and more HR functions are outsourced to specialists. If you are looking to secure HR contracts through the UK procurement system, there are numerous types of tenders to bid for:

  • Framework Agreements

For many Human Resource providers, framework agreements are the primary inroad to procurement opportunities. Frameworks can vary in size, expanding from regional to national and potentially international scopes. Once admitted onto a framework agreement as an ‘approved supplier’ you will be able to bid on ‘mini-competitions’ for work. Work available on the framework is entirely restricted to those selected ‘approved suppliers’. Status as an ‘approved supplier’ typically lasts four years but can vary dependant on the individual agreement.

In terms of HR contracts, framework agreements can typically be seen in the outsourcing of recruitment. For instance, the Health Trust Europe consortium manages framework agreements for national and international permanent recruitment of healthcare professionals within the NHS. ‘Approved suppliers’ services are solicited as and when needed to provide both national and international recruitment solutions to various functions and locations within the NHS.

  • Dynamic Purchasing System (DPS)

DPS’s, similar to framework agreements, allow ‘approved suppliers’ to bid for work that is closed to the wider tendering world. However, unlike framework agreements, DPS’s do not have a shut-off point and can be applied to at any time whilst open.

Why is HR being Outsourced? 

Opportunities to tender for HR contracts have increased drastically over the last few years. Many modern organisations now feel the need to outsource their Human Resource departments to independent agencies. Whether this be for recruitment, staff inductions or any form of employee continuous professional development.

The procurement of HR contracts has always been available. However, due to the teetering economic climate, companies are choosing to spend more time on financial decisions and less time on human ones. Opening the door for you to tender for various types of HR contracts.

For many organisations, the various functions of the HR department are too complex and overbearing to maintain in house businesses can receive several advantages from outsourcing elements of their HR functions. These include:

  • Cost-Effectiveness

Many businesses find it more cost-effective to outsource various HR functions. An in-house HR department requires salaries, further office space and high levels of specialised training. For many Directors, spending time on non-revenue generating activities can be frustrating.

Outsourcing HR functions allows for more time to be spent on strategic sales and growth goals, ultimately, tasks which will increase revenue. Research implies that despite working 50 hours a week, many business directors only spend 30% of that time on actual business functions. The remaining time is spent on HR and administrative tasks, which do not contribute to revenue. Outsourcing these functions can, therefore, produce a return on investment, greater than its cost.

  • Compliance & Risk

Employment legislation and regulation change regularly, which can be very difficult to keep up with. Outsourcing HR firms employ professionals whose role it is to keep up with current government regulation and legislation. Outsourcing this function aids in a business’s compliance with such changes. Therefore, ensuring that they avoid any fines or criminality through non-compliance. Outsourcing firms will continuously audit and improve company policy, guaranteeing the business is protected against such action.

  • Employee Development

Employee Development is essential to support both employee and company growth. Outsourcing these functions helps businesses to manage employee performance and development. Employee training sourced from a professional provider ensures the best quality and that adequate time is spent with each employee.

Commonly Outsourced HR Functions

There are a wide variety of HR contract opportunities available for you to seize. For further detail on this, get in touch with our Discover team, who can grant you access to the latest HR tenders available and help you identify which contracts would suit your business.

See below examples of just some of the HR contracts available to tender: 

  • Recruitment

Many public and private companies simply do not have the time to recruit their own staff. Therefore, they offer the role of recruiter out to contract. Inviting suitable candidates to tender their services for the fulfilment of this contract. Recruitment tenders in public procurement domains typically cover roles such as; healthcare professionals, housing officers, apprentices and civil servants, among others. Recruitment opportunities often come in the form of framework agreements or DPSs.

One such example is the recent UKRI Permanent Recruitment Framework. On this contract, UK Research & Innovation established a framework, requiring suppliers to deliver candidates befitting of high profile, senior roles within their organisation. The framework was split into 7 lots which included the recruitment of: Economics roles, Bioscience roles, Aerospace roles, among others. Through this procurement, UKRI aimed to appoint suppliers on this framework who would be positioned within relevant markets, using targeted sector knowledge to satisfy unique recruiting needs. The supplier’s ability to conform to these requirements would be assessed through their responses to various questions on their technical capacity and financial capability to do so.

  • Employee Training

Training is often outsourced to specialists in their field, as opposed to being delivered in-house. External training providers will enter businesses and provide programmes which could be centred around a variety of topics. These include CSCS training, disability awareness training and various continuous professional development programmes.

Training tenders can be commissioned via public procurement portals, should the local authority or national government deem it necessary to see business employees trained in developing content.

For instance, when releasing this blog, Durham County Council released a tender commissioning a single training provider to co-ordinate and deliver mental health training to SMEs in County Durham. With mental health, an ever-growing subject, the authority wishes to educate workers on how best to manage their mental wellbeing. This being particularly relevant in cases such as the Corona Virus Pandemic and the government call for social isolation.

  • Change Management

External HR support services can be drafted into business or authorities in order to assist in the management of sustainable cultural changes. This service is often referred to as HR consultancy. Again, when developing this blog, Westminster City Council advertised a tender for services, to assist their cultural change programme (for example). Suppliers were expected to enter the authority and deliver a two-phase change management programme.

Phase one began with a diagnosis. The supplier was required to analyse their current working practices and identify necessary changes to adapt to their desired new culture. Phase two involved the implementation of such changes as necessary through the provision of a well-communicated engagement strategy.

Many organisations fail to appreciate the intricacies and importance of human resources on their organisation. Revealing opportunities for you to secure HR contracts. Helping these organisations improve and adapt their human resource functions.

How can we help?  

Don’t worry – we have you covered.

Our dedicated Hudson Succeed team have decades of experience in supporting businesses with tendering for contracts and writing assertive and persuasive content from large blue-chip companies to freelancers and sole traders.

Our bid writers are experts in bid writing. Our Hudson Succeed team are on hand to provide you with hints and advice regarding all things tendering.

Ultimately, we’re here to help you succeed!

Get in touch today.

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