In some respects, one might feel sympathy for Ryan Breslow, the CEO of Bolt Financial, who became so exasperated with his company's human resources team that he dismissed every single member. Presumably, they had to deliver their own termination letters after, according to Breslow, they generated too many 'problems that didn't exist.'
The HR team that was let go—perhaps part of a broader reduction of 30 percent of the workforce in April, the fourth round of layoffs in as many years—might respectfully disagree with that assessment.
However, Breslow's boastful comments have revived the long-standing debate about the actual value of HR departments, which have endured years of ridicule in shows like the US version of The Office and the cult comedy Office Space.
His remarks follow a report from the centre-right think tank Policy Exchange, which argues that HR—intended to protect a business's interests—has become bloated and overly bureaucratic. The report claims HR departments are now more focused on promoting 'radical' equality, diversity, and inclusion policies and safeguarding corporate interests than looking after employees, costing firms £10 billion annually.
HR has expanded significantly in Britain over the past 15 years: the number of people in HR roles grew by 83 percent between 2011 and 2023, now representing roughly 1.6 percent of the workforce—double the EU average. According to the report's author, this expansion is bogging companies down as they obsess over taking the 'right' political stances, while employees are intimidated into silence for fear of saying the 'wrong' thing.
Government HR also under scrutiny
The proportion of HR staff may be even higher in government, although officials contest the figures in the Policy Exchange report. A 2022 audit of the Cabinet Office found approximately 700 HR staff out of around 11,000 employees, or six percent of the total workforce.
With such growth comes increasing bureaucracy: six-figure salaries for senior HR roles and a plethora of equality training initiatives that critics say distract people from their core work. Notable examples include 'unconscious bias' training that cost the Government £370,000 over five years between 2015 and 2020, despite officials admitting they were unsure of its effectiveness in combating stereotypes.
There were also reports of 'emotional check-ins' before Cabinet Office meetings, as described by former executive director Pamela Dow, who called the spread of such practices 'illuminating and depressing'. Writing for the New Statesman, she said: 'There is increasing concern that the size, remit and seniority of HR functions may be causing harm: to individuals at work, to the effectiveness of organisations, and to the economy.'
Case of Carl Borg-Neal
HR can cause damage beyond the workplace, as bank manager Carl Borg-Neal discovered. During an anti-racism training session, he asked what to do if he heard a black person use the N-word in the workplace. Borg-Neal, who worked for Lloyds, inadvertently used the word due to his dyslexia and was dismissed for gross misconduct. An employment tribunal later awarded him nearly £500,000 in damages, ruling that his question was asked without malice.
When HR becomes the problem
Questions arise about the purpose of HR departments when HR staff themselves become the kind of issue they are hired to investigate. Kristin Cabot, chief people officer at tech firm Astronomer, went viral last July after being seen in a romantic embrace with her boss, CEO Andy Byron, at a Coldplay concert in Foxborough, Massachusetts. With no one to take her case to—who manages HR for the boss of HR?—Cabot resigned, as did Byron. She has since claimed Byron lied about his marriage and that the scandal has rendered her 'unemployable', presumably because HR departments are discarding her CV.
Alternative approaches to HR
Breslow is not alone in eliminating a dedicated HR department, but his claim comes with caveats. Octopus Energy CEO Greg Jackson told BBC News in 2021 that he had done away with a centralised HR operation, citing his distaste for 'command and control' and his experience running small companies where he wore many hats, including HR. However, Octopus still engages in HR processes like nurturing staff development and handling grievances, but these are managed by line managers who know their staff well, rather than being outsourced to a separate department.
Kate Palmer, chief operating officer at UK HR firm Peninsula, says no approach to HR is necessarily wrong, even one that eliminates the HR department. 'The right way to do HR in a business will vary greatly dependent on the business’ expectations of the role,' she told the Daily Mail. 'In some, there may be no HR function at all, with managers in the business taking on the responsibility alongside their day-to-day duties.' She added: 'A business that wants to position itself attractively in the market, whilst staying compliant with the law should not underestimate the importance of HR.'
Breslow's caveats and criticism
Despite his headline-grabbing claim, Breslow admitted that Bolt still has a 'people operations' team. He believes larger companies should not be so quick to make the same move, though his firm, which operates remotely, can manage without a full HR department. 'We replaced it with a couple-person people ops team, which was meant to just streamline people operations,' he said at the Fortune Workplace Summit conference. 'I can't say that I would advise the same in a large company but we're back in startup mode. Those HR professionals have really important insights when you're in a peacetime, when you're at a larger company. We're a remote company. A lot of the potential issues that you would have in a workplace don't really exist because you're not in the same room as somebody.'
Nevertheless, Breslow has revelled in praise from like-minded individuals, tweeting an image of a winking ghost in a tie next to a gravestone reading 'RIP HR' on May 20. 'I didn't realized [sic] today was International HR Day,' he wrote—a snarky nod to the 'international day' invented by a Lithuanian body of HR professionals.
Detractors have pointed out Breslow's questionable business record. In 2021, he took out a $30 million personal loan on which the company was named a guarantor, later defaulting and leaving Bolt to cover the damage. A US government investigation led to his departure from the company; he returned as CEO last year as its value dropped, with $37 million of his shares cancelled. Bolt, once valued at $11 billion, has reportedly plunged to $300 million as of 2024.
Opinion remains divided on his decision, ranging from those who view HR as space-wasters to HR professionals who hold a different view. Nicholas Behbahani, an HR professional, wrote: 'For me it’s genuinely surprising to hear a CEO publicly make a statement like this. The reality is that HR doesn't "create" problems; it uncovers and addresses the complex realities of human dynamics in the workplace. Believing that removing your HR team makes your organizational problems disappear is a dangerous illusion!' IT executive Amy Diehl wrote on X: 'Firing HR and all your problems disappearing is like removing the smoke alarm because the noise was bothering you.'
