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How a PEO Service Can Benefit Your Business

If you are currently having difficulty managing your company’s HR tasks, it may be beneficial for you to enlist the aid of a professional employer organization or PEO service. Such organizations offer a comprehensive set of HR management services compared to typical HR outsourcing firms that offer only one or two services. With a PEO service, you will be able to free up valuable resources by entrusting the management of your HR tasks to a select group of professionals. These professionals work to ensure the maintenance and direction of your HR tasks according to the specific needs of your company.

Solutions Provided by a PEO Service

Although they perform many of the same services, a PEO company differs significantly from the tasks of a temp firm, staffing agency, or payroll administration company. While these organizations perform only a relatively small number of specific tasks, a PEO company will handle anything and everything related to HR concerns, from the hiring of new personnel to overseeing personnel benefits.

Some of the services commonly provided by a PEO service are:

     *          Employment administration
     *          Compliance management
     *          Benefits administration
     *          Workers’ compensation
     *          Payroll and payroll tax management
     *          Personnel hiring and recruitment
     *          Policy implementation
     *          Performance monitoring
     *          Training and development

A PEO service may offer a bundle of these HR-specific solutions or offer key services individually, depending on your needs.

The Role of a PEO Service in the Company

In situations in which a PEO is hired, the PEO provider and the firm that hires them usually share co-employment status. In this type of arrangement, the employees of the hiring company essentially work for the PEO as well. The primary employer is typically responsible for the day-to-day management of the employees, while the PEO is responsible for HR administration and dealing with employee concerns related to liabilities. The PEO provider is also primarily responsible for shaping and implementing employment and workplace policies, as well as ensuring the company adheres to current compliance requirements on the national and federal levels.

Although the bulk of the HR-related responsibilities are passed on to the PEO provider, the primary company usually still has the final say with regard to employee-related decisions. The management of a particular company may veto a PEO recommendation to fire an employee, for instance; management may also terminate a contract without the prior recommendation of a PEO service. The primary company, therefore, does not entirely relinquish the control of the workforce to the PEO but rather delegates the bulk of the HR management tasks to the PEO company. This allows companies to devote more time, resources and personnel to other tasks, while still taking advantage of the benefits of a PEO service.

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