Employee Leasing and HR Outsourcing
While many small business owners still take on the tasks of payroll and tax compliance, more and more people starting a business realize that these are issues that they really just don’t have the time necessary take proper care of. Using professional employer organizations (PEOs) can provide a unique co-employment opportunity that allows small businesses to access better benefit packages, standardize HR policies and practices, along with risk management support and workers’ compensation coverage.
A PEO differs from HR outsourcing companies or administrative services organizations due to the fact that a PEO participates as a co-employer. They are then able to employ a large number of employees to be used in thousands of businesses across the US. This helps lower health insurance costs and makes HR standardization a much easier task. A PEO may be the right choice for your business, but in the event that issues relating to lawsuits or other claims surface you need to be protected with a peo insurance policy.
The benefits of using a PEO
As a small business owner you’ll have access to many of the different services that are available through a PEO. You can choose from a selection of services based on your business needs. PEO service structure will vary from one company to the next, and there will be different cost structures and plan options you can consider. The PEO you choose will charge you either a flat rate per employee, or take a percentage of your total payroll in order to fund their services.
If you partner with a PEO many of those mundane corporate tasks related to most businesses will no longer be your concern. This arrangement provides you with more time to focus on the day-to-day operations of your business.In addition, PEOs have trained professionals that will ensure that your business complies with state and federal regulations. This includes tax structures, HR law changes, worker safety compliance and other risk compliance factors.
You’ll also benefit by being provided civil defense and employment liability insurance in the event that a former employee decides to sue the company for discrimination or wrongful termination. When you sign up with a PEO, you partner with a large company that can help provide resources in all legal matters. As long as you have peo insurance for employment practices concerns your business will be well protected and in good shape.