PEO Employee Benefits: How to Enhance Your Workplace Perks
Published: October 30th, 2023
As a business owner, it is a known fact your employees are your most significant asset, and providing the best benefits possible can prove to be highly advantageous. But with so many options available, narrowing down what’s best for your company and employees is complex, and that’s where PEOs step in as strong contenders.
In this blog, we will briefly overview PEOs and their role in today's business world, the key benefits of partnering with one, how PEOs enhance employee benefits packages, and determine if this HR outsourcing option is ideal for you and your business.
The Role of PEOs in Today's Business Landscape
Before diving into the specifics, it is essential to understand what a PEO is. A Professional Employer Organization (PEO) is a third-party HR outsourcing option that offers extensive HR services to large, medium, and small businesses and operates like an extension of your team.
Businesses are sometimes burdened with HR tasks, and the role of a PEO is to step in and relieve businesses from these difficulties, allowing them to thrive in the business world.
One of the critical roles PEOs play is ensuring compliance with state employment laws while providing benefits to businesses that might otherwise be unable to afford them, constantly meeting HR demands. To do so, a business enters into a co-employment relationship with a PEO, making them employers of record and sharing employer risks and liabilities for payroll taxes, insurance, and benefits administration purposes.
All in all, you gain access to HR experts, compensation, and benefits packages while ensuring your business complies with all applicable state and local laws. This allows you to focus on core operations, leverage their economies of scale for cost savings, and gain access to best practices. In short, a PEO offers businesses the opportunity to thrive in the business world by relieving them of HR difficulties. A PEO works with businesses of all sizes spanning various industries, and this can depend on the PEO company you choose.
Despite common misconceptions, this partnership does not mean replacing your internal HR staff or giving up executive decision-making. A PEO collaborates with your existing team to improve their skills and knowledge while allowing you to maintain control over administrative duties and daily operations.
Unleashing the Potential of PEOs: Key Benefits
Using their services provides a wide range of benefits that can positively impact your business on a large scale. Some of these benefits include:
Relief From Administrative Tasks: Since a PEO handles various administrative tasks, such as employee training and payroll services, business owners can focus on core operations and strategic decisions. For example, enhancing business operations, increasing revenues, or improving marketing efforts. Because redundant tasks are eliminated, you can focus on more critical aspects of the business.
Streamlined Payroll: A PEO benefits a business by offering a streamlined solution to ensure accuracy, compliance, and efficiency. Employee wages, tax deductions, and other payroll deductions are calculated and paid to employees on time with their automated payroll software. This software saves a business a lot of time which in turn, saves money.
Comprehensive Benefits: Businesses get enhanced and comprehensive employee benefits through a PEO’s cooperation with reputable insurance providers and this cooperation makes sure your employees get the benefits they deserve, including healthcare coverage, retirement plans, life insurance, and more.
Navigating Compliance: Navigating compliance with ease is one of the critical advantages of PEO services. Businesses can ensure compliance with state, local, and federal laws which reduces the risk of non-compliance, penalties, and legal issues. This also allows businesses to stay updated on health insurance regulations, retirement plan requirements, and other changing laws, making compliance a hassle-free process.
Enhancing Onboarding Experience: They provide training, development, and onboarding for new hires. Onboarding new talent is smooth and positive with a PEO, as they create a professional and welcoming environment. Employee handbooks, training material, and orientation ensure every new employee has the necessary information and support to begin working. Additionally, a PEO will also handle the paperwork, enroll benefits, and set up their payroll.
Time Savings: A human resource team is essential in managing your workforce and performing all human resource tasks necessary to do so. This is where a PEO comes in. Handling all administrative tasks such as payroll processing, tax withholdings, ensuring compliance, and employee benefits administration saves you significant time that would be spent on complex and sometimes repetitive tasks.
Can PEOs Improve Employee Benefits Packages?
The job market is highly competitive; therefore, it is crucial for a business to look for innovative ways to attract and retain top talent. Your business can develop a strong retention strategy through employee benefits. For instance, a comprehensive health insurance package that ensures employee satisfaction, and a robust retirement and life insurance plan show that businesses care about employees’ long-term financial stability.
Employee benefits packages can be significantly improved by utilizing a PEO's services. Due to the large economies of scale, PEOs can provide cost-effective and comprehensive benefits that would otherwise be too costly.
The variety and cost-efficiency provided allows your business to tailor benefits packages based on employee needs and preferences. Furthermore, the savings can be reinvested into better employee benefits, increasing employee satisfaction and retention.
These packages can be a crucial differentiator to help attract and retain top talent and show your commitment to employee well-being and satisfaction, adding to your business’s competitive advantage in the marketplace. To sum it up, through these benefits, PEOs can attract top talent, lower employee turnover and employment costs, and enhance overall business operations.
PEOs & Worker's Compensation: What You Need to Know
The administration of worker’s compensation is an essential part of HR functions, specifically in industries most at risk of workplace accidents such as construction, restaurants, and more.
Worker’s compensation is insurance that provides wage replacement and medical coverage for injured worksite employees during employment.
Providing worker’s comp is essential not only for employees but employers as well. Injured employees are given protection and compensation for medical bills and lost wages, increasing satisfaction and loyalty. At the same time, employers do not pay for these compensations out-of-pocket and mitigate the risks of legal issues.
PEO clients significantly benefit from providing worker’s compensation as the claims management process is handled, giving them access to savings of costs and streamlined administration.
Besides providing worker compensation packages, a PEO will usually conduct safety audits of your worksite, determining any hotspot or injury-prone activities. These audits mitigate the risk of work-related injuries. Additionally, they will provide adequate return-to-work programs for injured employees, easing the transition to work life.
When Is the Right Time to Partner With a PEO?
The decision to partner with a PEO is a significant one and should align with your business's needs, size, and goals. There is no one-size-fits-all answer to this question, but considering relevant information can help guide the decision.
Complex HR and payroll process
Your business's HR needs are one of the primary factors to consider. If these needs are complex, then a PEO may be the right fit for your business. On the other hand, if your business already has a robust internal HR department that can handle all functions, then the need for a PEO may be unnecessary.
Long-term business goals
Consider your business's long-term goals. If you are looking for growth and expansion, a PEO will have the infrastructure to support and achieve those goals efficiently. Additionally, it is vital to consider the services of a PEO and how scalable they are. These services should be able to accommodate your growing business.
Almost all businesses consider their budget when choosing to outsource or manage their HR activities in-house. As we have established, working with a Professional Employer Organization (PEO) can lead to cost savings due to their buying power and expertise in avoiding penalties and fines. However, it is crucial to assess the cost efficiency of partnering with a PEO versus handling all operations in-house.
In summary, a PEO is a valuable solution for optimizing your workplace as they provide extensive HR services such as compliance, benefits administration, payroll services, and more. Above all else, a PEO will enhance your workplace perks through their robust and comprehensive employee benefits and worker compensations.
Attracting and retaining top talent is a priority for businesses who want to achieve an extra competitive edge in the market, and one way to do so is by offering existing and potential employees a high standard of benefits such as health insurance, life insurance, dependent care, retirement plans, and worker's compensation. Additionally, these benefits provide more than just employee loyalty but also allow you to save on costs and enhance your business operations as time can be spent on more important factors of the business.
Finally, it is essential to know that deciding to partner with a PEO is not enough, several factors should be considered before. These include your HR needs and how complex they are, your long-term business goals, and your budget constraints.