Businesses of all sizes turn to PEOs (or professional employer organizations) for their HR outsourcing needs. According to NAPEO, there are nearly 500 PEOs operating in the United States. Although this deep well of PEOs creates a buyers market for interested companies, it also makes it difficult to determine what the best PEO is for your business.
As a PEO broker, NetPEO works to connect client business owners with PEOs that are right for them and their company. While most businesses require common services like payroll management and the application and handling of employee benefits packages, not all businesses have the same kinds of needs.
What to Look for When Searching for the Best PEO
The best PEO for your company will be able to take on any administrative task that your business needs assistance with. They should have a wealth of experience in the human resources industry, as well as experience handling payroll, compliance, and tax filing.
Experience With Your Industry
There are a number of government business regulations in every state that dictate how certain companies are required to operate. These laws are often industry-dependent, meaning that they affect different businesses differently depending on the industry in which those companies are situated.
The best PEO for your business will have experience handling the HR needs of companies that are in the same or similar industries as you. At NetPEO, our nationwide network of PEOs has helped companies across the entire spectrum of industries. Some of our previous clients have included:
- Law firms
- Construction firms
- Retail outlets
- Aviation companies
- Real estate firms
Experience Handling a Range of Human Resources Issues
Not all HR outsourcing companies are made equal. In the growing PEO industry, startups are popping up seemingly every day. If you’re trying to find the PEO that best suits your business, you’ll want to select one that has extensive experience handling the kinds of issues that you’re struggling with.
Many of the newer PEOs lack the knowledge and skills that more seasoned outsourcing companies have in spades. This can lead to errors and important tasks being mismanaged. Mistakes on payroll or employee benefits administration can lead to costly fines and lawsuits, so it’s best to avoid working with inexperienced PEOs.
Services Offered by PEOs
When looking for the PEO that best suits your business, it’s important to make sure they provide all the services you need a hand with. Ultimately, you’ll want to find one that specializes in all the administrative tasks you need to outsource. Here are some of the services you might want to look out for when choosing a PEO:
Many PEOs work with client business owners to strategize better recruiting techniques. These recruitment methods can enhance your ability to attract top-tier talent for critical positions. The best PEO will also be able to develop onboarding packets and new hire informational booklets you can use to inform your new workers of company culture and best practices.
The best PEO for your company is one that can handle all your payroll needs. Instead of struggling with the endless paperwork and hours of tedious organization that payroll requires, let an experienced PEO deal with those matters. If you do, you’ll be able to focus more on expanding your business and providing quality goods and services to your clientele.
Employee Benefits Administration
Retaining employees is important for a number of reasons. Not only can it help you hold onto your top talent, but it can also allow you to avoid costly turnover rates. Through the co-employment relationship, PEOs can negotiate better employee benefits packages at a lower individual cost, keeping your workers happy and content to work for your company.
The Best PEOs Are Certified
Certified PEOs are PEOs that meet standards put forth by the IRS. While PEOs aren’t legally required to attain certification, accredited providers are far more likely to operate with a high level of integrity.
Certified PEOs are also able to take on responsibility for your company’s tax payments. That means if there are any mistakes with your tax filing, your PEO will be held liable for penalties and lawsuits, not your company. If you think you’ve found the best PEO for your business, make sure they’re included in the IRS’s public listing of certified providers.
PEOs can also receive certification from the Employer Services Assurance Corporation. The ESAC is a non-profit organization that offers accreditation to PEOs that live up to specific ethical and financial standards.
Look for a PEO With a Payment Plan That Works for You
The best PEO for your business is one that accommodates your payment preferences. Smaller businesses, due to financial reasons, might want to pay their PEO differently than mid-sized and large companies do. The two most common PEO payment methods are as follows:
- Per employee, per year. Businesses that like to keep their PEO payment predictable will likely choose to pay per employee, per year. If you opt for this payment method, you’ll probably pay between $900 and $1,500 for each of your workers.
- Percentage of payroll. The first payment method requires businesses to pay a lump sum every year, but that might not work for small businesses that don’t have that much capital at a given moment. In that case, paying a percentage of payroll is the better option. Companies who choose this payment method usually pay between 3% and 10% percent of their overall payroll for a given pay period.
Although PEOs virtually pay for themselves with the amount of benefits and savings they come with, it’s important to find one that allows you to pay the way you want to. Remember to ask potential providers about payment methods when searching for the PEO that best suits your organization.
The Best PEOs Let You Customize Their Services
While some companies may prefer to outsource their entire HR or payroll department to their PEO, many like to have the freedom to choose what they receive support for. These businesses will usually continue to perform select administrative duties in-house and outsource the tasks they need help with to a provider.
If your company wants to keep some of its payroll or HR in-house, you’ll want to look for a PEO that allows clients to customize their services. These types of providers let their client companies choose a la carte style which services they want to outsource, so they only have to pay for the HR and payroll support they need.
Finding the Best PEO for Your Company Has Never Been Easier
Your company deserves a PEO with the experience to handle any issue that comes your way. As PEO brokers, we will develop a profile of your company’s needs and provide you with a list of potential providers. Once you’ve partnered, we’ll stay in touch throughout the duration of your relationship to solve problems and ensure your satisfaction.
At NetPEO, our nationwide network of partner PEOs has more than two centuries of combined experience in the HR world. To get a free consultation and start learning about how we can match you with the best PEO for your business, call us today or fill out the form on our contact page.