Financial Services Companies have the potential to transform their business by outsourcing the heaviest HR burdens to a Professional Employer Organization (“PEO”).
When RIAs, asset management, and fund companies work with a PEO, they enter into a co-employment agreement. The company becomes the client in a contractual agreement, and the PEO shares specific employer responsibilities with the client. The PEO agrees to handle responsibilities, certain rights, and risks through a relationship with both the company and its employees.
A co-employment agreement is generally referred to as a client services agreement (CSA), which specifies the services that the PEO will provide to the client. Through the PEO, the client’s human resource responsibilities and employer risks become the responsibility of the PEO in these critical areas:
- Provide your employees with access to cost-effective, PEO sponsored, comprehensive benefits without the administrative and regulatory burdens.
- Automate payroll processing and collection, remittance, reporting of wages/taxes and employee withholdings, W-2s, and garnishments.
- Access to a low cost retirement savings programs tailored for your industry, sponsored by the PEO, to aid with compliance and reduce risk of fiduciary liability.
- Shares or allocates employment compliance responsibilities with the client consistent with the client maintaining its responsibilities for its services and products.
- Workers’ compensation coverage through PEO sponsored program, as well as handle compliance, audits, paperwork, and certifications associated with running these programs.
A PEO should ensure that the client is compliant with HR issues and employment laws, providing the client with more time to focus on other critical business areas. The policies and procedures developed by the PEO provide efficiencies in company culture, leading to a well-run company.
Additionally, the PEO helps create safe work environments that ensure productivity and a sense of belonging for the employee. These ‘best practices’ settings help promote employee longevity and provide positive recruiting results. Over the last 18 months, PEOs have been instrumental in sustaining small to mid-sized businesses (SMBs) work-continuity plans during COVID-19.
At AspenHR, we provide HR Managed Services via our PEO and ASO solutions to alternative investment funds and financial services firms. Our white-glove service model enables our clients to truly focus on their core business while becoming best-in-class employers. Our specific services include HR compliance and consulting, employee benefits (medical, dental, vision, life, disability, 401(k), and payroll administration.