Hiring a professional PEO service is one of the most important decision business owners make. As more companies turn toward outsourcing the HR needs, it's no surprise that the PEO’s are also increasing at a rapid pace.

PEO helps business to overcome HR challenges and also allow small business to invest more in the business to help with growth. They will give you the time to focus more on other aspects of the business,  thereby helping you save business costs.

But while a PEO offers many advantages, there are many myths or misconceptions flying that prevent business from partnering with these professional. Have a look at them:

My HR Manager And The Team Will Not Be Part Of The Business Anymore:

PEO companies will take on all the administrative responsibilities, leaving more time for the in-company HR managers and team to work on other strategic projects. Besides, many HR managers don’t like taking the responsibilities of creating an employee handbook or writing a job description; some only want to develop hr program to accomplish their company’s goals.

PEO Is The Same As HR Outsourcing:

Not really! A PEO company will do more than making your HR managers free from paperwork. They will take on the most difficult burdens of running an organization like offering employee benefits and more. They will also take on all the legal liabilities of your company, making you feel secure.

Further, there are three ways a PEO service sell their business:

  • Direct: A PEO company will engage and sell their solutions directly into the small and medium-size businesses.
  • Broker-focused:  The company will work through a broker to offer services to organizations and companies. The middle-men/broker will introduce the PEO to the client to make them involved in the business.
  • Hybrid: Some PEO companies sell both through brokers and by directly to business.

PEO Will Make Me Spend More, And My Organization Will Not Save Money:

A PEO will work on many different aspects of an organization to save the company’s expenses. Some of the most common ways are:

Lowering worker’s compensation and health insulation costs. A PEO has the power to buy the low insurances to give an organization better coverage at low prices.

Minimizing Turnover:

Hiring, firing and recruiting can hit the company’s productivity, thereby increasing the company’s expenses. However, a PEO will help you hire the best and confident people fostering high productivity and pleasing work environment that will make them stick in your organization.

The Employees Will Not Accept The Change:

Employees will be happy to get a dedicated PEO service including the fact that a PEO company will give them access to other major benefits, which otherwise they might be lacking with. For instance, a small or mid-size business HR will not think of affordable health coverage. However, by partnering with a PEO company, the employees will have access to do so.

My Payroll Company Works Like A PEO:

PEO is not the same as that of payroll. Of course, they do the payroll work, but the work of a PEO is not just confined to that. A typical payroll company will offer other services like administration and risk management.

As the business grows, handling administrative tasks to the professional PEO service would be of great help!  

Published by Janice Cook