Frequently Asked

A good PEO (professional employer organization) should have a strong track record of providing exceptional HR services, compliance support, and access to affordable benefits, as well as an ability to customize its solutions to meet the unique needs of its clients. Additionally, a high-quality PEO should have the ESAC accreditation, client retention above 90%, and the ability to provide direct access to senior executives when necessary.
Yes, a PEO can help a company save money by providing access to more affordable benefits, reducing administrative costs, and improving HR efficiencies, which can lead to increased productivity and profitability. By using a PEO, companies avoid having their own HR departments. These departments can be costly, and are often not viable options for small and medium-sized businesses. In these cases, PEOs can ensure support and compliance while keeping costs lower.
The biggest pros of using a PEO include access to more affordable benefits, improved HR compliance, reduced administrative burden, and access to a team of HR experts. While these are important to many companies, PEOs come with some cons such as the potential of experiencing service issues with PEOs that centralize or fully automate customer support functions. Choosing the right PEO for a company’s needs can help mitigate the risks.
While a PEO can handle many HR functions, depending on its size a company may still need an internal HR person to manage day-to-day tasks. These tasks can include recruiting, performance management, and culture-building initiatives. A PEO can provide support and guidance to an internal HR team, but cannot replace it entirely for a larger business. Small and medium-sized businesses may not typically have an HR person, and may be able to just use a PEO for their needs.
For companies that decide they want to handle HR on their own, or want to move to a different PEO than the one they’re using, leaving a PEO can be a relatively simple process. However, it’s important to carefully review the terms of the contract and follow the proper procedures for termination to avoid any potential legal or financial issues. Ideally, the contract would be carefully reviewed before signing on with any PEO, so the company knows when, why, and how they can part ways in the future.
There are many potential benefits to using a PEO. These benefits typically include access to HR expertise and resources, improved compliance with employment laws and regulations, streamlined HR processes, and cost savings. By outsourcing HR functions to a PEO, companies can focus on their core business functions and leave administrative tasks to the experts.
A PEO (professional employer organization) is a company that provides HR services including payroll, benefits administration, and risk management, to other businesses. PEOs take on some of the employer’s responsibilities such as remitting payroll taxes and providing insurance coverage, thereby allowing companies to focus on their core business functions.
An ASO (administrative services organization) and a PEO (professional employer organization) are similar in that they both provide HR services to businesses. However, while PEOs typically provide a bundled HR solution, ASOs provide a-la-carte services and are not able to offer any cost reductions in insurance.
Exempt employees are generally salaried and considered exempt from overtime pay, while non-exempt employees are generally paid hourly and entitled to overtime pay if they work more than 40 hours in a week. Exempt employees must meet certain salary and job duty requirements under state and federal law, while non-exempt employees are protected by various wage and hour laws, including minimum wage and overtime requirements.
An HRIS (human resource information system) is a software system that helps manage employee data, while PEOs are companies that provide HR outsourcing services, including HRIS management. A PEO will administer their HRIS platform as part of their service model.
A certified PEO is a PEO that has undergone a rigorous certification process with the IRS, demonstrating their compliance with tax, wage, and HR regulations. Certified PEOs are held to a higher standard of accountability, which can provide peace of mind for clients who want to ensure they are working with a reputable PEO that can meet the requirements of their specific industry.
PEOs (professional employer organizations) provide a comprehensive HR solution, including benefits administration and payroll processing. In contrast, HROs (human resources outsourcing) offer more specialized HR services like recruitment and training and focus on enterprise-level clients (those with 1000+ employees).
PEOs must comply with state reporting requirements, which vary by state and can include wage and hour reports, unemployment tax filings, and workers’ compensation reports. The information the PEO handles for a company and provides to the state is specific to the state and industry, and may not be the same between one state and another.
Among the most common employee onboarding challenges include ensuring legal compliance, efficiently processing paperwork, and effectively integrating new hires into the company culture. Companies big and smal deal with these kinds of challenges, and working with a PEO can help most kinds of businesses handle onboarding more efficiently.
When choosing a PEO, consider factors such as company size, industry, and specific HR needs. Companies should look for a PEO with a good reputation, transparent pricing, and a range of services that align with its goals. Since every PEO is different, companies want to find the one that’s the best fit for their needs.
PEO costs per employee vary depending on the services provided, company size, and other factors. Typically, PEOs charge a per-employee, per-month fee or a percentage of wages fee. Companies considering a PEO will want to make sure they understand the cost per employee before signing a contract for PEO services.
PEOs offer a wide range of services including HR compliance, benefits administration, and payroll processing. Staffing companies typically provide W-2 employees to their clients on a temporary or contingent basis, thus acting more like a recruiting firm versus a PEO. Both types of companies can be highly beneficial to a business, but they serve and perform different functions.
Yes, seasonal workers are eligible for overtime pay if they work more than 40 hours in a workweek, unless they are exempt under certain criteria such as agricultural workers. Employers should review federal and state regulations to ensure compliance based on their industry and other factors.
A variable hour employee is an employee whose weekly work hours are uncertain or vary from week to week. This variation in hours worked makes it difficult to determine the employee’s status as full-time or part-time for benefits eligibility purposes.
PEO health insurance rates vary based on several factors including the size of the company, the geographic location, and the level of coverage chosen by the employer. These rates will be different for nearly every company, because each company is unique.
When it comes to reporting requirements, a PEO assumes responsibility for compliance and reporting in most states, while the client remains responsible for reporting in states where PEO reporting is not allowed or not recognized. Companies should make sure they understand where and what they will have to report, instead of solely relying on a PEO to handle everything.
While payroll services focus primarily on payroll processing and tax filing, PEOs offer a broader range of services. These services include HR management, benefits administration, and risk management, making them a more comprehensive solution for small and medium-sized businesses than a payroll service.
Virtually all HR functions can be outsourced, including recruitment, payroll, benefits administration, compliance, performance management, training, and more. The decision to outsource will depend on the specific needs and resources of each organization, as well as its size, number of employees, budget, and other factors.
PEO costs vary depending on factors such as the number of employees, services required, industry, and location. However, PEOs can typically provide significant cost savings by pooling resources and leveraging economies of scale, which can save companies money on their HR needs.
When considering a PEO, it’s essential to ask questions about its experience in your industry, service offerings, compliance expertise, and level of offered support. Companies should also ask questions about the PEO’s fees and pricing structure, as well as its customer satisfaction track record.
Performance management provides employees with regular feedback on their work and helps them identify areas for improvement. That can motivate employees to develop new skills and improve their performance. One of the benefits of that performance improvement is the opportunity for career growth and advancement within the company.
Human resource management can contribute to a company’s success by ensuring that the organization has the right talent in the right roles. Proper management of HR also fosters a positive work environment, and helps with implementing effective HR policies and procedures that promote productivity and employee engagement.
A human capital operating plan is a strategic document that outlines an organization’s goals for managing and developing its human resources. It typically includes strategies for attracting and retaining talent, developing employee skills and capabilities, and managing performance to achieve business objectives.

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