Outsourced Human Resources Agreement
This attorney drafted Outsourced Human Resources Agreement
sets forth the terms of an agreement between a company and an
outsourcing agency for such agency to perform company’s
specified human resources tasks. The document contains
numerous standard provisions as well as options to customize the
document to fully set forth the parties’ agreement.
ALL INFORMATION AND FORMS ARE PROVIDED “AS IS” WITHOUT ANY WARRANTY,
EXPRESS, IMPLIED, OR OTHERWISE, INCLUDING AS TO THEIR LEGAL EFFECT AND
COMPLETENESS. They are for guidance and should be modified to meet your needs and the
laws of your state. Use at your own risk. Docstoc and anyone who participated in providing or
modifying any form is not creating or entering into an Attorney-Client relationship. Docstoc
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does not provide legal advice. The information and forms are not a substitute for the advice of
your own attorney.
Outsourced Human Resources Agreement
This agreement is entered as of _________________, [Instruction: Insert date.] by and between
__________________, [Instruction: Insert hiring company name.] a _____ [Instruction:
Insert company formation information.] ("Company"), and _______________________,
[Instruction: Insert outsourcing company name.] a ______ [Instruction: Insert outsourcing
company formation information.] ("Outsourcing Agency") (“Agreement”).
WHEREAS Company wishes to outsource certain of its human resources obligations and wishes
Outsourcing Agency to act as its agent to perform such human resources obligations specified
herein [Comment: Parties may wish to include language as to whether or not Company will
use Outsourcing Agency exclusively or non-exclusively, and also whether or not Company
will retain any human resources functions in-house.]; and
WHEREAS Outsourcing Agency wishes to assume such obligations,
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties agree as follows.
1. Outsourcing Agency shall perform the following tasks (each, an “Outsourced Service” and
collectively, the “Outsourced Services”), commonly and/or previously performed by
Company’s human resources department or an alternative outsourcing agency, as Company’s
agent:
A. [Instruction: Insert specific tasks which Outsourcing Agency will perform. Same
may include, but need not be limited to such tasks as recruiting new hires,
developing Company’s application and interview process, formulation of employee
handbook, payroll services, etc.]
2. Outsourcing Agency shall be paid for the Outsourced Services according to the fee and
payment schedule set forth as Exhibit A-Fee and Payment Schedule.
3. This Agreement shall commence on the date hereof and shall continue for a period of one (1)
year from the date hereof (the "Initial Term"). This Agreement shall automatically be
extended for successive one (1) year terms (each a "Renewal Term") unless either party gives
the other written notice of its intention not to extend this Agreement at least ninety (90) days
prior to the end of the then current term, or unless terminated as provided elsewhere herein
(the Initial Term, together with each Renewal Term, if any, being collectively referred to
herein as the "Term"). Any time after expiration of the Initial Term, Outsourcing Agency
may change the prices and terms on which Outsourced Services will be provided by
providing at least one hundred twenty (120) days prior written notice to Company (the "Fee
Notice Period"). Company shall have the right, in its sole discretion, to reject such changes
and, in such case; this Agreement shall automatically terminate without penalty to either
party upon expiration of the Fee Notice Period. [Instruction: Parties may revise the
language set forth in this paragraph to reflect their agreement.]
4. Outsourcing Agency shall make reasonable efforts to inform Company of changes in human
resources law or regulation applicable to the Outsourced Services, and shall notify Company
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in the event any of Company’s practices (and Outsourcing Agency’s performance of the
Outsourced Services) shall become illegal during the term of this Agreement. Outsourcing
Agency shall not be required to knowingly perform any Outsourced Services which are or
become illegal during the term of this Agreement. Any such failure to perform such illegal
Outsourced Services by Outsourcing agency shall not be considered a breach or default
hereunder and shall not give rise to a right of termination for cause by Company.
5. The parties hereto agree that Outsourcing Agency’s performance of some or all of the
Outsourced Services hereunder may be terminated as set forth herein. It is parties’ mutual
understanding that a termination of provision of one Outsourced Service shall not be deemed
a termination of provision of any or all other types of Outsourced Services set forth herein.
In the event provision of one type of Outsourced Service is terminated, provision of all other
types of Outsourced Services shall be ongoing, unless separately terminated pursuant to the
terms of this Agreement by the terminating party
6. Company assumes all expenses related to the sending of information to Outsourcing Agency.
Outsourcing Agency is responsible for properly equipping its offices and personnel with the
necessary equipment to provide the Outsourced Services set forth in this Agreement.
Outsourcing Agency shall not be liable for any failure to provide Outsourced Services in
accordance with this Agreement in the event Company fails to assume any such expenses, or
fails to provide information or documentation to Outsourcing Agency necessary for it to
comply with the terms of this Agreement.
7. [Comment: If Outsourced Services include payroll services, parties should include
language here regarding same. Sample language could include the following: The
Company shall designate a commercial checking account (the "Payroll Account") and
shall maintain therein available funds in an amount sufficient to cover all payroll taxes,
the Company’s net payroll as reported to Outsourcing Agency. Outsourcing Agency
requires that all funds scheduled for electronic transfer from Company be deposited
into the Payroll Account in sufficient time to insure that Outsourcing Agency’s debits
clear. Outsourcing Agency shall bear no liability for any failure to pay any employee in
the event Company fails to electronically transfer funds into the Payroll Account in
sufficient time for Outsourcing Agency debits to clear. Company authorizes
Outsourcing Agency to: (a) initiate debit or credit entries to its Payroll Account for the
applicable charges related to the services provided by Outsourcing agency; (b) send or
transmit to the bank, a credit entry to the account of an employee to effect a payment
from Company to the employee; and/or (c) send or transmit a debit entry to the
employee’s account in order to effect a payment from the employee to Company or
cover any shortfall.]
8. [Comment: Parties should consider including language with respect to any insurance
either party will be required to maintain, especially if any specialized insurance or
bonds will be required, as in an instance where the Outsourced Services include
management of Company employee 401K funds, for instance.]
9. Outsourcing Agency shall be responsible, at its sole cost and expense, to hire sufficient
employees to perform the Outsourced Tasks as set forth and in the manner set forth herein.
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10. Company shall permit reasonable access for Outsourcing Agency to its facilities in
connection with work hereunder as required. No charge shall be made for such visits.
11. It shall be the sole obligation of Outsourcing Agency, at its sole cost and expense, to obtain,
provide and maintain training for its staff in current and applicable human resources
procedures, laws and regulations to ensure the Outsourced Services are provided in a manner
compliant with such procedures, law and regulations.
12. Except as required in the performance of its obligations under this Agreement or with the
prior written authorization of the Company, the Outsourcing Agency (including for purposes
hereof, its employees, agents, representatives, consultants and contractors) shall not directly
or indirectly use, disclose, disseminate or otherwise reveal any confidential information,
including but not limited to information regarding Company personnel, and shall maintain
confidential information in confidence for a period of five (5) years from the date of
termination or expiration of this Agreement, for whatever reason. Upon termination or
expiration of this Agreement for any reason whatsoever, Company and Outsourcing Agency
shall leave with or return to the other all documents, records, notebooks, computer files, and
similar repositories or materials containing confidential information of the other party and
such other party's affiliates, including any and all copies thereof.
13. With respect to all matters relating to this Agreement, Outsourcing Agency shall be deemed
to be an independent contractor. Outsourcing Agency shall not represent itself or its
organization as having any relationship to Company other than that of an independent agent
for the limited purposes described in this Agreement. Nothing in this Agreement shall be
deemed to create any joint-venturer, employee-employee relationship or partnership
agreement between the parties hereto.
14. [Comment: Parties may wish to discuss and include here mutual indemnification
language with respect to potential claims regarding human resources issues. As the
scope of indemnification language is very broad, no specific language is included
herein.]
15. Each of the parties hereto shall designate and maintain at all times hereunder a project
manager to serve as a single point of contact for the other party to assist in the resolution of
any matters relating to this Agreement. Further, employees of the Company shall at all times
be provided with a single point of contact, including contact current contact information, at
Outsourcing Agency to answer questions with respect to any Outsourced Services. Such
person shall be an employee of Outsourcing Agency, at Outsourcing Agency’s sole cost and
expense, and available to Company employees upon reasonable request, during normal
Company business hours. Contact with such person by Company and/or its employees shall
be at no additional cost to Company. Outsourcing Agency shall not be required to have any
such point of contact available at any time other than during normal Company business
hours, and such point of contact need not be exclusively available to Company, unless
otherwise set forth in this Agreement.
16. In the event of litigation to resolve a dispute pursuant to this Agreement, the prevailing party
shall be entitled to collect reasonable attorney’s fees and costs in addition to any judgment.
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17. This Agreement shall remain in effect for the term specified herein unless otherwise
terminated by the parties. Either party may terminate this agreement in whole or in party by
giving not less than ninety days’ written notice to the other party by registered mail to the
principal place of business of the other. Notice of termination shall become effective upon
receipt of such notice by the party to whom it is addressed. Each party shall remain liable
hereunder during such notice period.
18. All indemnification obligations shall survive the termination of our services or the
termination or expiration of this Agreement. [Comment: If no indemnities are provided,
delete this language.]
19. No waiver by either party of the breach of any term or condition of this Agreement will
constitute a waiver of, or consent to, any subsequent breach of the same or any other term or
condition of this Agreement.
20. This Agreement will be governed by the law of the State of _____ [Instruction: Insert
state.].
21. The pronouns used herein shall include, where appropriate, either gender or both, singular
and plural.
22. Both parties agree that this Agreement is the complete and exclusive statement of the mutual
understanding of the parties and supersedes and cancels all previous written and oral
agreements and communications relating to the subject matter of this Agreement. No
revision, amendment or modification may be made except in a writing signed by both parties.
23. The covenants, obligations and conditions herein contained shall be binding on and inure to
the benefit of the heirs, legal representatives, and assigns of the parties hereto.
24. This Agreement or any subsequent amendment or modification hereto may be executed by
facsimile and/or in one or more counterparts, each of which when so executed and delivered
shall be deemed an original, but all of which taken together shall constitute but one and the
same original. Each party shall accept any such signed faxed counterpart as full execution of
this Agreement or any subsequent amendment or modification thereto.
25. The terms of this Agreement are confidential and no press release or other written or oral
disclosure of any nature regarding the terms of this Agreement shall be made by either party
without the other party’s prior written approval; however, approval for such disclosure shall
be deemed given to the extent such disclosure is required to comply with governmental rules
or a valid court order.
26. If any provision of this Agreement shall be adjudged by any court of competent jurisdiction
to be unenforceable or invalid, that provision shall be limited or eliminated to the minimum
extent necessary so that this Agreement shall otherwise remain in full force and effect and
enforceable.
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IN WITNESS WHEREOF the parties have executed this Agreement on the day and year first
indicated above.
[Instruction: Insert parties’ signature blocks.]
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Exhibit A-Fee and Payment Schedule
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