Professional Employer Organization (PEO)
Professional Employer Organization, commonly referred to as PEO, are companies that allow employers to outsource certain tasks, such as payroll, workers compensation, employee benefits, recruitment and training, and safety management. PEOs commonly work under the title of “co-employment.”
When a PEO hires employees for a business, they become that business’ employee. That is how they are labeled on tax and insurance forms. This means that the employees actually belong to the PEO. The client businesses pay a fee to the PEO in order to use their employees. The PEOs gain insurance and workers compensation for themselves and the businesses they work with.
This is normally seen as a win-win situation for everyone involved. However, this is not suitable for every business. Consider the questions below if you are wondering whether you should work with a PEO:
- Do you have an HR department? Everything that a PEO can do for you lies under the roles of a human resources department. If you are a small or new company, you might not have the resources that you need to have your own HR department. Even if you do, you might want to consider placing this important department in the hands of professionals. Most PEOs will have the resources and experience to handle the duties of a human resource department effortlessly.
- How many employees do you currently have? You might find yourself overwhelmed if you have a large number of employees. The professionals that work at PEOs are able to put together anything from employee training manuals to benefits packages for large numbers of people.
- Are you planning on expanding your business any time soon? If you are planning some major expansions, you are going to need help. Where are you going to find your new employees? How are you going to accommodate your growth? Will you be placed in a new tax bracket or require an insurance change? A PEO will be able to answer these questions for you.
- How much are you spending on insurance? PEOs work with large numbers of employees, so they are able to purchase insurance at a discount. This can be a big asset to your company by saving you hundreds or even thousands of dollars. However, you need to know that the insurance will go through the PEO and not through you. They will handle insurance claims or changes.
SOGO Wealth & Risk Management wants to make sure that you get the help you deserve, so here is one final question that you need to ask yourself: Have I thoroughly researched the PEO company that I am working with? Not all PEOs are accredited. If you want to protect your business and your employees, make sure that you work with the best PEO available. Our professionals are ready to help you find the assistance you need.