"Smaller Teams, Bigger Stakes: The New HR Reality"

"With AI eating the paperwork, what remains for HR is people, culture, and teams."

Pavel Shynkarenko

Founder and CEO of Mellow.io · September 04, 2025 · 7 min read

Automation Is Eating the PaperworkThe biggest paradox of today’s HR is that many professionals don’t spend a lot of time working with their teams in practice. Operating globally from hubs like Cyprus, we see that a lot of HR departments of our clients are drowned by bureaucracy, presentations, reports, paperwork — non‑human things — and we tend to think it’s normal. I believe that era is closing fast.Even now, LLM models work with information better than any of us. They can create a job description based on one word, fill out forms for tax payments, and scour the perfect candidate across all channels. Still, it does not work as a system, but rather as a set of non‑synchronous tools where a person (HR) acts as a connector.We also have a lot of concerns about this technology, especially in Europe, despite it delivering magical results. When an LLM hallucinates, even one mistake is enough to say, “It’s too risky, we need to double‑check it with a human.”It’s okay, we need time. I would say two years or so. In two years, HR will be a completely different job.When a bot inside Slack can generate a payslip for a Cyprus employee, approve vacation, and file a tax form on the fly, the ground shifts entirely. All micro‑tasks collapse into one HR brain that lives where employees already live. Integration pain and duplicated data will force the market into a few big platforms that swallow the best ideas and let the rest wither. When that happens, every rule‑based task — from multi‑country tax withholding to offer‑letter generation — turns into a prompt and a click.Unlike the emergence of yet another SaaS platform that has been popping up for the past 15 years, an LLM agent that can proactively perform tasks dramatically changes business processes and economics. Solving tasks otherwise will become inefficient, and the C‑suite will think about it and remind teams about it all the time.I don’t think HR will be the first department where we will see such a solution emerge; most likely, it will affect product teams or marketing first. Many companies in Cyprus, like LearnWorlds, already have integrated AI into their workflows.Still, the AI revolution won’t stop at a product note. Progress can never be stopped, only slowed down — which particularly happens with EU laws. Even Gartner expects 75 percent of routine HR inquiries to reach chatbots first by 2025.What will be left for HR professionals? People. Culture. Teams.With the advent of AI tools that solve algorithmic problems, the number of humans on teams will shrink. We are generally already seeing a trend of people preferring to work in smaller teams, and micro‑companies are increasingly raising investments. Speed and agility are becoming even more important than before.Each such small team will need to understand where the company is going on the one hand, and on the other hand, to keep up its speed, hear each other, and work together. I’m sure the latter will be a particularly big challenge as there will be a large number of generalist experts who can do many things at once, thanks to AI.For example, while we used to see content teams divided into copywriters, designers, videographers, gradually those boundaries are being washed away more and more. With AI, you can create video, audio, and text. And when you get such a large number of generalists, they start to encroach on each other’s space and clash, because everyone knows how the work can be solved. HR will have to deal with building relationships between such architects so that they can help each other achieve the results.Another important job to be done is the intercom, the role of which is growing just catastrophically. And we see it now from the history of layoffs that are already taking place against the background of the mass introduction of AI, and these layoffs are likely to be more and more. Accordingly, HR will have to properly communicate layoffs to people, build transparent communication, and organize the change‑management process in general.From Process Custodian to Culture ArchitectI’m sure the trend toward smaller teams will affect HR as well. The current benchmark is about  2 HR professionals per 100 employees. Strip out payroll runs, benefits enrolment, and paperwork, and that ratio falls even further.There will be less work to do, and the work will be different. People ops will have to think on the one hand about how to change their flow of work, which is a very big challenge for everybody, not only for HR teams, but for all of us. On the other hand, you will have to deal with human relations, people’s skills, and their mental condition on a different level.The good news is that AI will not be able to replace human relationships yet — even through a couple of levels of automation, which we are likely to see for ourselves in the next 5–10 years. Because working with people is the uncertainty of uncertainty. It cannot be algorithmized.I encourage HRs to think of technology as a way to solve non‑human problems, and don’t be afraid of it. The pace of the future moves so fast, but we still have time to harness technology, so our future will be human‑centric.

"I’m an entrepreneur and product builder who has spent more than a decade at the crossroads of fintech, legal‑tech, and HR‑tech. Today, my company, Mellow.io, helps over a thousand businesses find, hire, pay, and manage a flexible workforce. As I spent time talking with HR teams, both internally and externally, and increasingly communicating with AI, I have come to some conclusions about technology that I would like to share with you."- Pavel Shynkarenko -