When a company considers outsourcing their HR department, they turn to Co-Employment by hiring a PEO firm. The Professional Employer Organization role becomes the employer of record for multiple employee management tasks. Those responsibilities range from employee benefits and payroll, risk and safety management, recruiting and development, along with training and workers' compensation.
How Does a PEO Help Your Business?
A PEO firm helps small and midsize businesses get access to benefits, all or part of the human resource duties, along with managing employee payroll and any associated taxes. Often the business owner hands over any other administrative, employer-related, tasks because they want to put all their energy and focus on growing the business, rather than working in the company.
The top four areas a Professional Employer Organization role helps is with Benefits and Coverage, Employer Compliance Support, Payroll Administration, Retirement and Perks.
Ten Guidelines When Choosing Your Co-Employment PEO firm
Should You Consider Outsourcing The HR Dept to a Co-Employment Firm?
From what you’ve read so far, it sounds good. But let’s not stop there. In a 2017 study, PEOs: Good for Businesses and Their Employees, by economists Laurie Bassi and Dan McMurrer, shows that small businesses using a PEO firm grow 7%-9% faster, have up to 14% less employee turnover, and close to 50% are more likely to not go out of business.
Of those three categories, what’s most important to you?
If you’re like most entrepreneurs, all three are equally important. To uncover more about PEOs, check out their industry’s recognized group, National Association of Professional Employer Organization at https://www.napeo.org/.
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