Why You Should Consider A PEO Partnership For Your New Or Small Business
New and small businesses should consider partnering with a professional employer organization. When you're overseeing a handful of people, it seems easy enough to run their payroll and fill out their employee forms yourself. However, here are a few things that may start happening:
- A handful of employees will turn into a few handfuls
- Employees will start demanding better access to their payroll data
- Employee health and wellness issues will increase
- Employees will start demanding more comprehensive benefits
- Employees will want auxiliary benefits (401k, life insurance, dental, etc.)
Trying to implement these kinds of employee benefits for more than a few people isn't easy or cheap. A PEO broker can help you do all of these things and a lot more, but a PEO isn't for every business. The question you must answer for your business is whether you can benefit from a PEO.
How to Tell if Your Business Can Benefit from a PEO
The best way to figure out if a PEO is right for your business is to just consider your need for HR services. Can you manage all the HR and employee relations duties yourself? Can you afford to hire someone to handle those duties?
Keep in mind that HR services can include any or all of the following:
- Employee relations
- Payroll processing
- Employee benefits
- Liability management
- Recruitment and training
- Employee performance monitoring
- Workers compensation claims and paperwork
That's a lot, often too much for one person to handle once the employee pool grows beyond 10 or so employees. However, when the business is small or in its early stages, it doesn't always make sense to hire dedicated employees to handle each of these duties. In such cases, a PEO represents an ideal option.
A PEO is a Co-Employer
When you partner with a PEO, the PEO becomes a co-employer. That means they share in the responsibility of your employees. It's not as simple as outsourcing duties. It's a true partnership.
You don't lose anything in the partnership. In fact, with a PEO, you will have the leverage to hire more people because you'll have the benefits packages that many employees come to expect. This is especially true if you can offer medical insurance and other benefits through the PEO partnership.
Finding the Right PEO Service
With all that said, you still will have to take the time to find the right PEO service. There are many of them out there, and they don't all operate precisely the same. You should consider using a PEO broker to find the service that suits your business best.