Every week it seems you can find more and more information on the benefits of a PEO for a growing business. Youâ€™d think a PEO was the magic pill for helping a company succeed. The talking points are great and all, but what kind of business uses a PEO?
Does a PEO only fit a certain type of business? Would a PEO work for a very small business with less than 10 employees? Weâ€™ll take a look at the 3 common businesses that typically use a PEO so you can decide for yourself if you are the right kind of business for a PEO.
What Kind Of Business Uses A PEO For Benefits?
One of the main reasons that a company would use a PEO is to take advantage of their attractive employee benefits rates. You canâ€™t beat the premium rates youâ€™d get with a PEO over buying your own health plan.
Small Businesses In General– A small business of under 100 employees stands to make out the most with a PEO for benefits. Small business health plans are skyrocketing past their already steep rates and many of them are just not affordable now. Trying to find a cheaper plan just means a higher deductible for your employees, making it very difficult to see why youâ€™d want to switch. A PEO is the better choice for a small business, purely from a financial standpoint.
A Very Small Business- For businesses with less than 10 employees, the cost of obtaining healthcare coverage for their employees rises dramatically, often leaving small business owners with no choice but to send their employees out on their own to purchase individual health plans. This scenario usually also severely limits a very small business as to the pool of available talent who is willing to deal with buying their own coverage over working for a business that provides benefits. A very small business can find respite in a PEO as they are able to offer benefits that both the small business owner and their employees can afford. What kind of business uses A PEO to the best of it’s advantage? It would definitely be a very small business. Best part is, it is usually much better coverage than either one of them could get on their own.
Small Businesses Who Need More Than Health Insurance- There is usually more to benefits than health care coverage if you want to compete for talent in your area. Retirement benefits options, wellness programs and other kinds of employee perks will woo your employment candidates away from your small business if all you can offer is simple health insurance.
Todayâ€™s employers are offering a lot more to win the hearts of new employees and keep their staff happy for the long term. If you want to offer these kinds of benefits but canâ€™t see how you can allocate any additional budget towards these programs we have good news; when you work with a PEO you do.
What Business Uses A PEO For Other HR Outsourcing?
Letâ€™s face it, most businesses need a lot of help when it comes to dealing with Human Resources issues. Legal compliance, benefits management, employee management; all these things can severely limit a small business owner from being able to focus on growth. When businesses are big enough to need more help with HR management but are too small to hire on an HR person full-time, their best move is to work with a PEO.
PEOs take over all of the HR management so that small business owners donâ€™t have to. Theyâ€™ll handle all of the paperwork, legal compliance and benefits management so you can do what you wanted to do all along; grow your business.
PEOs also take over all the payroll functions so there is no need for DIY payroll management or an outsourced payroll company. All HR and Payroll issues come under one roof. They manage payroll and you get to walk away from the headache. Theyâ€™ll even pay your payroll taxes for you. What could be better than that?
Are You A Business That Uses A PEO Yet?
If you are not working with a PEO but think you might want to be, talking to a PEO broker like PEO Spectrum can give you the direction you need in getting the information you want so you can make a decision if a PEO is right for you before you start dealing with sales reps. It costs nothing to talk to a PEO broker so there is nothing to lose besides lost nights of sleep trying to manage it all on your own.