There are three major reasons people choose a PEO arrangement
Cost SavingsThird and very importantly is the Cost Savings that economy of scale offers either by up front savings or slowing of the creep of ever increasing insurance and benefits costs. There is no way a small or midsized employer can get the kind of pricing on benefits and workers compensation without becoming part of a larger pool of employees to spread the risk and justify discounts. This happens with Workers Comp, Unemployment costs, and employee benefits in most cases.
Our job is to get you the most PEO value and protection possible for your situation and budget! We are able to service and sell clients all over the United States due to the advancements in Technology. You can scan, fax or email documents , video conference for discussions and talk, or text for questions and answers.
ComplianceSecond is the outsourcing of Compliance permitting lower overhead and freeing up existing employees to perform productive and profitable tasks. Also PEO’s are responsible to keep you in compliance for all your Human Resource related legal requirements. With the implementation of Obamacare or the Healthcare Affordability Act the compliance issues are going to be huge and require massive record keeping with penalties, fines and possible imprisonment for major violations.
Avoid RiskFirst to avoid risk; co-employed employees are on the workers compensation policy of the PEO so if a suit is filed it is against the PEO. The same goes for Unemployment premiums and claims in most states. The big risk avoider that is underappreciated is EPLI insurance coverage that most PEO’s carry with each client listed as an additional insured. This coverage is Employment Practices Liability Insurance and usually covers the entire cost of litigation and settlement of employement related claims such as sexual harrassment or discrimination. These policies may be more valuable with the implementation of Obamacare or Healthcare Affordability Act.
*** Note to Self ***
- Remember When you started with nothing and did all the administrative work and clerical record keeping in the evenings or on the weekend. Now that your business is growing to the size that you now have to be aware of and keep up with, all the Local, State, Federal laws and regulations regarding your employees and how they are paid, taxed, treated, hired, and discharged. I am becoming an Administrator instead of an Operator. (for many the business runs you!) Bob Eaton my PEO Broker can help me !!! Businesses are generally run and managed by Operators! Meaning people who have the expertise to make operational decisions focused on growing sales and retaining customers. Bob Eaton my PEO Broker spent over 30 years dealing with Operations beginning as an Assistant Manager and finally ending up as a C.O.O. managing over 200 employees in multiple states. He has the mindset of an Operator. His advice to Outsource is a chance to get out of my own way and let my business grow! item