What’s a PEO?

July 17, 2012

Today, business owners are buried under mountains of paperwork. There are more federal regulations to consider and human resource tasks have increased as well. For these reasons, administration of employee benefits and payroll remain core tasks businesses offload. After all, such tasks can be time-consuming and require specialization, yet both are straightforward enough for an external provider to take on.

Enter the PEO. Across the U.S., businesses are finding that full-service Professional Employer Organizations can more easily support HR functions. A virtual HR department for small and medium-sized businesses, PEOs can more efficiently handle personnel-related services including payroll processing, payroll tax fillings, employee benefits management, employer liability management, employment taxes, workers’ compensation coverage and claims resolution. Additional PEO services include employee recruiting, background checks, interviews and development of effective job descriptions and compensation structures.

Other benefits of PEOs include tuition reimbursement and management training courses. These value-added tools help provide an effective training and development program, which is essential in attracting the most talented people and helping them to advance. When an employer provides for continuing education and advancement training, the business improves productivity by enhancing the skills of company’s workforce.

PEOs are important and reliable options for small and medium-sized businesses to better manage the HR function. It is the only thing they do all day, everyday, plus costs can be spread across numerous clients rather than one business covering the expense of full-time employees, and all that is needed-from computers to electricity-to support those functions in-house. While larger corporations may always need to manage HR and accounting onsite and certainly have more budget to rationalize all related costs, PEOs make sense for smaller companies looking to do more with less while enabling teams to focus on core business functions and overall strategy.

You’ll be hearing more about PEOs in the coming years. They will soon be the norm, and easier than you’d think to plug into your organization.

Mercy Mildener
Public Relations and Marketing Consultant

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