Why Use a PEO to Grow Your Business?

PEO stands for Professional Employer Organization. These bodies are the best-kept secret of the most successful small businesses. They take care of all your HR needs, from time-consuming payroll and administrative tasks to employee benefits, state and federal compliance and much more. As experts in this specific field, they leave you and your team free to get on with what you specialize in.

Contracting out your HR department has a host of other benefits. As well as a truly unbiased and objective outlook on HR, you gain access to the professional networks your PEO is affiliated with. This usually involves a team of legal experts, recruitment consultants, cheaper drug testing and insurance specialists.

You probably have your most detail-oriented and business-savvy staff dealing with payroll. Surely their time could be better used than for a task that’s essentially a skilled admin role. However excellent someone is with spreadsheets, recording employees’ hours and spending time going through rosters and number crunching isn’t maximizing your profits.

You free up hours of their time by outsourcing this burden to a PEO. Detail and accuracy are their key strengths, and the person who deals with paying your staff does this day in, day out. If your business is growing, your team will be extremely busy, and this is where many small to medium-sized businesses go wrong. Mistakes with staff pay upset your biggest assets, and it’s easily done when a workforce is stretched. Removing this risk could be one of the best decisions you make.

When you’re experiencing growth, it’s time to look at the productivity of each person in your organization. Streamlining output and ensuring people are carrying out the tasks should be high up on your list of priorities. Bogging down your best minds with trying to keep up with HR compliance, admin and recruitment could be losing you thousands of dollars a year.

PEOs manage thousands of employees across their networks. This gives them access to some extraordinary employee benefits at a discounted rate. Not only do they have data on which benefits workforces respond to best, but they can save you money on this integral but often overlooked way of attracting and retaining talent. As well as day-to-day benefits, they take care of retirement benefits, health benefits and all of the perks you’d usually associate with big companies.

You can work together with a PEO to tailor these benefits to the requirements of your workforce. Be sure you speak to your team about what they want and fulfill some of their requests for optimum success. Employees can be skeptical of outsourcing HR, so wowing them with these welfare enhancements can be a great way to win them over.

Even just outlining how much a PEO can help your business makes working with them highly attractive. When you get into the details, it’s difficult to see why any small business wouldn’t seek out this partnership. As their success continues to increase and more people see the positive effects, they’re becoming the norm. Within a few years, some experts believe the majority of SMBs will work with a PEO.

Gaining access to all the channels for recruitment is costly. It’s also another huge drain on your resources. Hiring and firing are such important aspects of running a business that you should only have your best minds working on it. Trawling through CVs and trying to find new networks is expensive and eats into productivity. With a PEO, you can hand this responsibility over to them.

By giving them specific parameters, you can ensure they find people who work with your business. Many will be experienced in screening potential team members as well, which is another weight off your shoulders. To make sure the PEO is working for you, during the initial stages you can screen together. Once you’re confident they understand your specific needs, you can hand this task over to them. This leaves you free to focus on interviewing and hiring the top candidates instead of concerning yourself with the filtering process.

Claims management and insurance premiums are costly and take up more of your precious time. If you’ve ever felt like there just aren’t enough hours in the day, it’s likely you could seriously profit from partnering with a PEO. Your creativity, innovation and discerning nature should be focused on
strategies for improving the service you provide and laying the groundwork for future growth.

PEOs have their own workers’ compensation insurance program, which again usually comes at a discounted rate due to the sheer numbers of employees they have on their books. As a small business, it’s unlikely you’ll be able to compete with these rates. Their team will work in collaboration with your core HR people to mitigate risks and expertly answer questions asked by employees who are affected by this tricky part of the business.

We all know that legal costs can quickly escalate and lawsuits are the undoing of many SMBs. Top PEO firms have access to equal opportunity specialists as well as people who work with employer’s liabilities on a daily basis. Their intricate knowledge of compliance significantly lowers the risk of you sending out release agreements that aren’t in compliance with state law. As an added layer of defense, you have an extra team of
specialists to mitigate potentially devastating settlements.

One of the best ways to make your business stand out is by offering world-class training and giving each of your workers a slick, professional employee manual. Once again, the costs of these resources are lower due to the fact that PEOs have the economies of scale necessary to ensure printing, design and training costs are discounted.

It can be difficult to stay on top of employee performance. Favoritism in the workplace is a reality, even if it’s difficult to admit. Having great relationships with your workforce is excellent for morale, and all great leaders inspire their teams. However, this closeness can cloud your judgment when it comes to performance. Having an objective third party keeping track of productivity and output leaves you free to motivate your team and get the best out of them.

Most PEOs use employee performance tracking software to make this integral part of day-to-day running quantifiable and objective. They can print out the results and give you real-time factual evidence of who is doing well and who’s not doing so good. No one can accuse you of treating them unfairly when these carefully calculated results are there in black and white.

You can’t put a value on peace of mind and this service more than pays for itself. Even the smallest payroll, ADA, OSHA and EOCC mistakes can see your company penalized with disproportionate fines, and the best employees will be the first to leave if you make any mistakes. Make sure your top employees are doing what they specialize in.

Saving on employee benefits as well as staff retention provides a huge boost to your long-term profitability. Not only that but tracking the success of your team by measuring their performance in real time allows you to ensure you look after the staff who are looking after you.