What happens when internal HR sides with employees?

This is an uncomfortable topic, and one many leaders hesitate to name out loud. Business owners often describe it like this: “HR keeps pushing back on management decisions.” “It feels like HR is advocating for the employee, not the business.” “I’m not sure who HR actually works for.” For growing businesses under 100 employees, this tension is more common than people admit.

Why this perception shows up in growing businesses

In smaller businesses, HR roles are often created reactively.

HR is brought in to:

• reduce risk
• professionalise processes
• manage conflict
• protect the business

But the authority, scope and decision rights are not always clearly defined.

When HR is unclear on whether they are:

• advisers
• decision makers
• employee advocates
• compliance gatekeepers

misalignment is almost inevitable.

What HR is actually meant to do

HR is meant to:

• advise on risk
• support lawful and fair decisions
• ensure process integrity
• reduce exposure for the business

HR is not meant to:

• override leadership decisions
• act as legal counsel
• advocate for one party
• replace management accountability

Problems arise when HR advice is interpreted as alignment with one side rather than guidance on process and risk.

Why HR can appear to side with employees

This perception often forms when HR:

• focuses heavily on procedural fairness
• highlights employee rights without context
• challenges management decisions publicly
• slows down action without offering alternatives

In many cases, HR is attempting to prevent risk.

However, without commercial framing, that caution can feel like opposition.

When HR advice is actually protecting the business

There are situations where HR is right to push back.

This is usually when:

• decisions are rushed or emotional
• documentation does not support the outcome
• termination follows a complaint or leave
• managers have acted inconsistently
• the risk profile is genuinely high

In these moments, HR caution is not employee advocacy.
It is business protection.

The issue is not the advice itself, but how it is delivered and understood.

When HR alignment becomes a real problem

HR alignment becomes problematic when:

• HR positions itself as the final decision maker
• leadership feels unable to act
• managers stop escalating issues
• employees learn to bypass management

This creates:

• authority confusion
• slower decision making
• cultural erosion
• increased risk over time

HR should support leadership, not replace it.

The cost of unresolved HR misalignment

When this tension is left unresolved:

• managers disengage
• performance issues linger
• termination decisions stall
• founders are pulled back into daily people issues

This is often when businesses start questioning whether internal HR is helping or hindering growth.

Why this happens more with internal HR than outsourced HR

Internal HR can struggle when:

• reporting lines are unclear
• HR sits between competing leaders
• risk aversion becomes self protection
• relationships become political

Outsourced HR avoids many of these issues because it:

• has clearer advisory boundaries
• is not embedded in internal dynamics
• focuses on outcomes rather than influence
• supports leadership authority

This is why many growing businesses find outsourced HR more effective at this stage.

What good HR alignment actually looks like

Aligned HR support:

• presents options rather than ultimatums
• explains risk in plain language
• supports leadership decisions once made
• challenges respectfully and privately

It does not:

• undermine managers
• create fear based advice
• block decisions without alternatives

Good HR advice creates clarity, not camps.

How leaders should respond if this is happening

If HR feels misaligned, the solution is not avoidance.

Leaders should:

• clarify decision authority
• define HR’s role explicitly
• align on risk tolerance
• reset expectations around advice versus decisions

In many cases, a reset conversation resolves the issue quickly.

If it does not, the structure may be wrong for the stage of the business.

Where HR support adds the most value here

HR support is most valuable when it:

• balances fairness with commercial reality
• supports managers through difficult decisions
• reduces escalation rather than fuelling it
• reinforces leadership authority

This is where outsourced HR often provides a circuit breaker for growing businesses.

Before HR becomes a blocker

If HR feels like it is taking sides, the issue is usually structure, clarity or expectation, not intent.

The right HR support should make decisions easier, not harder.

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