Four Things a Professional Employment Organization Can Do For Your Business

A PEO (which is short for "Professional Employment Organization" or "Professional Employer Organization") is a type of entity that can save you a lot of headaches and frustration by taking over some of the major employee-related functions that you as a business owner or manager are responsible for. These are tasks that can soak up your time and make you want to pull your hair out. Functions so heavy in paperwork and bureaucracy that you're not even left with enough time to run your business. Running a business is tough, and there is often only the slimmest of margins between succeeding and failing. So you will be well-served to position yourself so that you can concentrate on actually running your business rather than doing paperwork. By outsourcing certain employee-related functions, you are freed up to take care of the things that affect your bottom line.

A professional employment organization provides services that fall into four major categories. The following sections discuss each of those categories.

Workers' Compensation Administration

Workers' compensation administration includes tasks such as reviewing and administering claims; performing safety-related audits and reviews; creating and administering workers safety plans; reporting and documenting on-the-job accidents; complying with OSHA regulations; and workers compensation billing reconciliation.

With a PEO, workers' comp claims at your company are charged against the PEO for purposes of re-evaluating insurance costs, rather than your own company. It prevents the potential disaster of having a major claim filed against your business, which could possibly be so large that it raises your workers' comp insurance rates past the point where you can possibly pay them. If you operate in an industry in which there is a reasonable chance of someone getting hurt, then using a PEO to manage your workers' comp can save you many thousands of dollars, or possibly even prevent you from going out of business.

Payroll Administration

Payroll administration includes functions such as preparing and distributing payroll checks; making employee direct deposits; managing government withholdings; reporting; preparing W2s, W3s, and other employee-related documents; payroll record keeping for audits and inquiries; and tracking vacation and sick time. If you currently, do your own payroll, then you know what a burden it is. A PEO can take care of this for you and save you so much money in other areas that payroll administration is practically free.

Benefits Administration

Benefits administration includes tasks such as 401k administration; management of disability plans; life insurance administration; COBRA compliance; benefits handbook creation; flexible spending account administration; annual benefit plan review; and administration of employee assistance plans.

Providing your employees with the best benefits you can possibly afford is a good way to keep your employees happy and productivity high. Hiring a PEO to manage your employee benefits can save you a large amount of time and money by freeing you from having to research, shop, and compare benefits plans. It also saves you money by offering you lower rates than you would be able to get on your own.

Human Resources Administration

Human resources administration includes such tasks as accepting employment applications; performing background checks; creating employee handbooks or communicating employment policies by other means; audit compliance; managing EPLI insurance; and legal assistance. Hiring the wrong people, or having employees who are not clear on their roles and responsibilities, can do your business much harm. Rather than have lax HR policies or spending hours managing HR functions yourself, you can have everything done for you and avoid the headaches associated with poor human resources management.

As you can see, hiring a professional employment organization can take many burdens off of your shoulders so you can concentrate on what's really important, which is running your business.