We’ve discussed the differences between PEOs and ASOs on this blog before, and the conclusion we made then was there are certain benefits between choosing the two depending on the size of your organization. The bottom line of our last article was that whether you run a small, medium, or a large business, HR services are needed to oversee managing your human capital.

As the title suggests, this article we’ll be discussing five big ways that PEOs can help small businesses with their HR needs. So, if you’re running a small business and need some convincing on if a PEO is right for you then keep reading!

Five Benefits to PEOs

There can be significant advantages of choosing a PEO to handle your HR services, especially if you’re a small employer that may not have the HR expertise or system capabilities of a larger business. Below are five of the biggest benefits a small business can gain by choosing to go with a PEO:

  1. Vendor Management– Running your own HR department in house can be a hassle as it is a job with many hats. Typically, small businesses have to deal with at least eight different vendors to keep their HR department in fighting shape, vendors like recruiters, payroll companies, safety specialists, insurance brokers, etc. Going with a PEO allows them to take the burden of vendor management away so you can focus on building a profitable business.
  2. Experienced HR Partner– When choosing to go with a PEO, you end up employing a skilled group of HR professionals who’ve dealt with multiple clients. That experience when dealing with the complexities of HR issues is unparalleled in gaining a business edge. Partnering with a PEO allows for you to buy in to a larger pot of HR professionals, freeing up resources to focus on the aspects of running a business.
  3. Benefits Packages– A big benefit of a PEO is its ability to provide cost-effective comprehensive benefits for your employees without the administrative and regulatory headaches that come with it. As a co-employer, the PEO is able to offer a wider variety of benefits to your employees than if you were to handle it in house, such as vision, dental, life and disability, etc. As the plan sponsor, the PEO handles all of the administrative tasks like negotiating rates, enrolling employees, providing legal notices and handling COBRA administration.
  4. Administrative Relief– PEOs can also help with one of the biggest HR burdens, HR administrative tasks. These tasks are the gears that run your business-like tax filing, unemployment and workers compensation claims management, payroll processing, reporting, recruiting, etc. PEOs assist in this area by taking the burden off of your business, allowing for more resources to be allocated towards growing your business.
  5. Compliance Assistance– HR law can be confusing and cumbersome to a small business, especially if you run an operation that crosses state lines. Keeping up with all of the countless new HR and payroll laws, regulations, and rules that apply to your business can be costly as the fines of violation can be huge. This is where PEOs can give you a big advantage over an in-house team. You’ll have access to a legion of trusted advisors whose sole job is to keep up to date on any changes to the law to not just keep you safe, but the rest of their clients safe as well.

The benefits listed above are not an exhaustive list, but they are some of the biggest benefits that small businesses can get from choosing to partner with a PEO. Working with a PEO allows you the benefit of seeing your investment in human capital grow through a single source. If you are still on the fence of whether or not you should choose to go with a PEO for your business, you can get in contact with one of our experts to provide a consultation!

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Written by: Matthew Muriel

Meet Matthew! Matthew is our content writer and has been working with us for a year. He enjoys working for SolveHR because it allows him to practice his copywriting and allows him to build experience in his fledgling career. Matthew studied at the University of Texas at San Antonio and earned his degree in English with a concentration in Professional Writing. He values learning new processes in the HR industry and then conveying those ideas to the company’s clients. When he isn’t working, he enjoys reading nonfiction, with his favorite book that he recently read being The Gene by Siddhartha Mukherjee. If he could go anywhere in the world he would travel across the United States and visit all of the national parks.

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