There are many reasons why an existing client or prospect might consider a PEO. By providing payroll, benefits, and HR services and assisting with compliance issues under state and federal law, PEOs allow small businesses to improve productivity and profitability, to focus on their core mission, and to grow. According to a recent study by noted economists Laurie Bassi and Dan McMurrer, small businesses that use PEOs grow 7 to 9 percent faster, have 10 to 14 percent lower employee turnover, and are 50 percent less likely to go out of business. Through a PEO, the employees of small businesses gain access to big-business employee benefits such as: 401(k) plans; health, dental, life, and other insurance; dependent care; and other benefits they might not typically receive as employees of a small company.
Are all PEO's right for every employer? No, they aren't, selecting the right PEO is crucial to make the most of the relationship. We take care in making sure our clients understand the PEO relationship and ultimately select the right PEO.
Here is our approach:
- Assess your workplace to determine your human resource and risk management needs.
- Make sure the PEO is capable of meeting your goals. Make sure you meet the people who will be serving you.
- Ask for client and professional references.
- Does the PEO have a demonstrated history of adherence to the industry's professional performance practices, including responsible financial management of its business? Check to determine if the PEO’s financial statements are independently audited by a CPA, whether their risk management practices have been independently certified by the Certification Institute, or if their operational, financial, and ethical practices have been independently accredited by ESAC.
- Investigate the company's administrative and management expertise and competence. What experience and depth does their internal staff have? Does the PEO corporate staffing allocation follow the priorities of the PEO's marketed services? Does their senior staff have professional training or designations?
- Understand how the employee benefits are tailored. Determine if they fit the needs of your employees.
- Review the service agreement carefully. Are the respective parties' responsibilities and liabilities clearly laid out? What guarantees are provided? What provisions permit you or the PEO to cancel the terms of the contract?
- Make sure that the company you are considering meets all state requirements.
If you are interested in learning more about PEO's or are already in a PEO and want to see if another would be a better fit, please give us a call at 516.804.3383 extension 1 or complete the form HERE