Highlights
- PEOs can ease the burden on your HR team, helping achieve business objectives.
- Choosing the right PEO that aligns with your budget and needs is crucial.
- Alliance is an exceptional choice for companies seeking PEO services due to its comprehensive and streamlined solutions. Contact us and get started!
Having a successful company is about more than just selling a lot and growing. You need to have a team of workers who are committed and happy to be part of your organization. To achieve this, you need a top-notch HR team. An excellent option is to have a strategic ally such as a PEO in this area. These partner companies can help you grow strategically, save resources, and free you from the operational burden of HR.
What is a PEO? We will explain it in this blog. We will also discuss how a co-employment relationship works, the benefits of PEO services, and the crucial steps to choosing the PEO that fits your company’s needs.
What Is a PEO?
A Professional Employer Organization or PEO is a company that offers outsourcing of Human Resources services, allowing companies to lighten the load and focus on strategic tasks. According to NAPEO, PEO clients typically have between 10 and 99 employees, making PEOs particularly beneficial for small and medium-sized businesses.
But beware: Finding the right partner is complex. PEO services can vary, and companies considering such an agreement should carefully evaluate the services offered by different PEOs to ensure they meet their specific needs, especially considering other types of companies in the Human Resources industry, such as staffing companies and HROs.
Differences Between a PEO and Other Services
As we mentioned, some significant differences exist between PEOs, and the services offered by other business models in the HR outsourcing industry. The key differences you should know are:
- Co-employment: This is what characterizes all PEOs. Co-employment is when your company and the PEO are the worker’s employer. However, this does not affect the operation of your company. The thing that will change most is seeing a new logo on your employees’ paychecks.
- Shared Responsibility: Client companies and PEOs share employment obligations and responsibilities, including liability for Workers’ Compensation and employment practices. In traditional HR outsourcing, the company outsources services without assuming legal employee responsibilities.
- Payroll and benefits: PEOs often provide comprehensive HR services. The PEO bundles these services as part of the co-employment relationship. HR outsourcing may involve hiring specific HR functions that may not include these services.
Outsourcing HR to a PEO is not just a cost-effective measure; it’s a transformative step towards efficiency.
How To Choose a PEO
If you are determined to hire a PEO to be your ally in the HR area, these are the things you should keep in mind to find the PEO that fits your company.
- Assess your needs: First, identify the HR functions you want to outsource, such as payroll processing, benefits administration, compliance, risk management, and employee relations. Depending on your chosen PEO, these can come as a single package or separate services.
- Define your budget: It is vital to be clear about the budget available for HR services. Learn about the fee structure of each PEO. Consider the overall cost and services provided.
- Research PEO options: Research and compile a list of PEOs that align with your business needs. Look for PEOs with a history of serving companies in your industry and size.
- Evaluate the services offered: Verify that the services provided by the PEO align with your needs and offer what you need. Look for comprehensive offers that add value.
- Examine benefit packages: If one of the services you need is employee benefits, examine each PEO’s benefits package. Consider the variety of options and flexibility to customize benefits to the needs of your workforce. Remember that benefits packages also affect areas such as recruiting and retaining talent.
- Client referrals and reviews: Ask for client referrals and check out online reviews to gauge the satisfaction of companies that have worked with the PEO.
- Consider flexibility and scalability: If your business is dynamic and growing or transforming, evaluate the flexibility of PEO services and their ability to scale with your business.
- Negotiate terms: Work closely with the PEO to negotiate terms that align with your business objectives. Pay attention to contract terms, service level agreements, and termination clauses.
When selecting a PEO, take your time to evaluate options, ask questions, and choose one that suits your needs and can grow with your business.
Focus Efforts on Company Growth With a Trusted PEO: Alliance
Are you looking for a PEO ally that can help you grow? At Alliance, we offer comprehensive and optimized solutions to simplify our clients’ HR processes. Our advanced systems and experienced staff ensure smooth payroll processing, efficient onboarding through eHire software, and thorough risk management analysis.
By acting as co-employers, we take care of your company’s HR and administrative responsibilities so you can focus on growth without the burden of routine tasks.
Our dedication as a PEO to reducing risk and costs is evident in our business risk analysis and cost-effective employee benefits services.
Small and medium-sized businesses that partner with us gain access to Alliance specialists who efficiently manage tasks such as time and attendance tracking, Workers’ Compensation, and other Human Resources tasks, making us an invaluable ally for companies looking to improve. Contact us today and discover the advantages of having a PEO for your Human Resources services!