Professional Employer Organizations (PEOs) tackle some of the hardest tasks facing any business owner, human resources management. While most businesses want hiring and firing control, the hassles of payroll, updating employee handbooks and building successful training programs all require special expertise. When a business owner or manager lacks that expertise, new talent is needed. In-house talent can mean spiraling employee costs that may not add immediate organizational value. PEOs change the conversation.
PEOs serve the same function as a fully staffed HR department, but as a third-party provider. Working with a PEO shifts certain operational responsibilities to the vendor, leaving business owners to get on with their core functions. Payroll and all of the management activities that go along with it move to the PEO. Essentially, all of your employees now work for the PEO, but you define their workday. The PEO writes the checks, files the payroll taxes and tracks time off, but all work activities are carried out at your business.
A PEO does a lot more than just handle payroll. Small businesses are among the least likely to offer compensation packages that include things like retirement benefits, but these are the benefits employees want the most. When top qualified candidates have a choice between a compensation package that includes retirement benefits and one that doesn't, they are likely to go with the larger company that can afford a better
These services can benefit you by offloading complex, time-consuming tasks where a mistake can be very costly, and benefit your employees by helping to build more engagement and job satisfaction.
Retirement benefits do more than just attract new talent. They also help you retain your existing top performers. Employees already invested in a retirement package are often reluctant to leave. Average employee turnover in the United States sits at 42 percent, but companies that work with PEOs enjoy rates as low as 28 percent.
Certified Professional Employer Organizations (CPEOs) have certification from the IRS and pass along specific tax benefits to their clients. Propel HR has the honor of being one of the first PEO companies to earn certified status, and the only one headquartered in the Carolinas. CPEO applies nationwide. To get the maximum benefit of working with a PEO and to minimize potential liability, working with a CPEO is a solid choice. CPEOs take on all tax liability along with their payroll management services, so any errors do not pass on to you. When you offload HR responsibilities, it can be with serious peace of mind, as long as your PEO is a CPEO.