What is a PEO and Benefits it can Provide for Growing Organizations

What is a PEO and Benefits it can Provide for Growing Organizations

by on 12 Mar, 2020

For small organizations and businesses, it can be very difficult to take care of the essential details. There are so many components to running an organization, and many leaders–owners, executives, and managers alike–find themselves overwhelmed by them all.

However, it doesn’t have to be frustrating or overwhelming. There are options that provide the assistance needed to seamlessly run operations and take care of the difficult and tedious aspects of a business.

By partnering with someone that will assist, or even take over, the human resource components that businesses and organizations require, they are freeing themselves from one of the most difficult tasks. That is why, when running a growing business or organization, it is essential to find streamlined and comprehensive human resource solutions, which is what a Professional Employer Organization, or PEO, provides.

What is a PEO?

A PEO is an organization that offers human resource solutions to businesses and organizations by providing payroll and tax assistance, as well as by offering assistance with compliance to state and federal labor laws and regulations.

They can also give access to insurance, including medical, dental, and life, as well as 401(k) plans, and more benefits that are not usually offered by small businesses and organizations.

By giving these necessary, yet often difficult and time-consuming, tasks to a PEO, leaders free to focus on other aspects of running the business.

What are the benefits of using a Professional Employer Organization?

There are a number of benefits that businesses receive by hiring a PEO, including:

Saving Money

When working with a PEO, the employees of the specific business or organization are able to receive benefits as if they were working for a large corporation instead of a small business. This is because the PEO is able to create a group that is made up of the employees from the multiple businesses and organizations that they work with.

What this means for the small business is that they will save money on the benefits that are offered to their employees, because larger groups have smaller rates. By being grouped together with the other employees that are covered by the PEO, insurance coverage and rate options are far less expensive.

Businesses and organizations can also save money by not needing to hire extra employees to take care of the human resource components. With a Professional Employer Organization taking care of those aspects, businesses can refrain from making that unnecessary hire.

When they do hire people, they will be able to give them more essential and more relevant tasks to work on, as the human resource aspects will be taken care of.

Risk Protection

In business, compliance can be incredibly tricky, especially for those smaller ones. Every year, there are little things that fall through the cracks and small mistakes that are made, that end up causing a ton of trouble, even fines, for the business.

However, when the business or organization uses a PEO, they don’t need to worry about making a mistake, learning all the compliance regulations, or even filling out and reading a ton of paperwork. Professional Employer Organizations know what they’re doing. They are experts on compliance, as well as all of the other aspects of human resources.

You won’t need to worry about ensuring that you have everything done properly. You will have peace of mind, knowing that the areas of your business that are most confusing, are in great, professional hands.

Focus on other business aspects

One of the greatest benefits of hiring a Professional Employer Organization is that as the manager, you will get your time back. The time and effort required to learn about all of the human resource aspects of business, and then to take care of them, implement them, and constantly monitor them, is huge!

Many business owners find themselves overwhelmed and burnt out after starting their business because they weren’t prepared for the difficulties and time that would be spent on things like payroll, taxes, benefits, and compliance.

In fact, a lot of businesses end up failing because the owner is unable to work on the essential and desirable tasks that made them start their business in the first place. They forget their passion and excitement and end up letting their vision slip.

By handing the human resource tasks over to a PEO expert, they are once again able to remember why they do what they do. They are once again able to focus on what they love and make their business into the great organization that they envisioned from the very beginning.

The Final Word on PEOs

Many small businesses and organizations initially balk at the thought of hiring a PEO. They already have a small budget, and these startup go-getters feel like they shouldn’t pay for something that they can do themselves.

However, when they finally make the leap forward to get started with a PEO, they wonder why they didn’t do it sooner. PEO’s provide something invaluable to small businesses. They make the excitement of business ownership real again. They take care of things that were piling up and causing money loss and time loss.

Using a PEO allows you to have the business that you have always wanted. It’s the right step to take if you’re ready to grow your business and reach the next level.

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Disclaimer: this article does not represent expert advice and is provided for informational purposes. Please get in touch if you would like expert HR advice.

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