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HR Outsourcing For Small Business Done Correctly

Why Outsourcing HR To The Right PEO Is So Important?

When it comes to selecting the right HR outsourcing company for your business, knowledge is power! Whether you’re looking to reduce some of the administrative burdens of your HR department or looking for a more strategic support system to achieve growth objectives, it’s important to understand the process of how to choose a qualified PEO.

When Professional Employer Organizations (PEO) first came around in the mid-1980s, they performed a variety of HR outsourcing tasks and administrative functions such as benefits and workers’ compensation, payroll administration, risk management and government and tax compliance. Making these tasks run smoothly remains essential. In today’s marketplace, many PEOs are positioned for strategic partnership by offering services like recruiting and retaining talent, performance management, compensation and reward incentives, succession planning, and corporate culture and its direct correlation to employee satisfaction in an effort to help you grow your business.

Many executives now recognize these HR initiatives are key factors in their company’s productivity and performance.  They understand human resource needs a more strategic approach versus a simple tactical solution.

While most full-service PEOs only outsource HR completely, many can tailor their services to meet your individual needs.  It makes sense that forward-thinking PEOs have characterized themselves as expert consultants that deliver strategic HR services instead of another solution provider.  Many qualified PEOs have successfully transitioned their service offering from tactical to strategic. But, there is no love lost for less qualified PEOs making false claims about what they can provide.

So, if you’re looking to completely outsource HR or get some much-needed help with critical HR functions, how do you choose a PEO that will help you prosper?

Selecting a PEO isn’t a walk in the park. It’s a time-consuming process that should be managed by decision-makers who understand your company’s business goals. They need to understand what the company requires from a PEO relationship.

Every business wants or needs something different. If you simply want to reduce the administrative burden on your HR staff, you could benefit from outsourcing by selecting a few specific functions. If you need more strategic HR help, you may see eye to eye with a PEO partner that provides a more robust list of services.

What Does HR Outsourcing Provide To A Business?

It’s unlikely that the right PEO partner is going to fall into your lap. There is no proven formula for achieving the perfect balance between outsourcing all or some of your HR. But, understanding the process and what services a PEO provides will have you feeling confident that you’re not running around in circles.

Knowing the services available and distinct differences of each HR Outsourcing PEO will keep you from wasting time and energy during the selection process.

Human Resource Services

These services are specifically designed to help you strategically administer employee needs, from the time they’re hired to the time they retire, allowing you to hold all the aces and focus on your business. A strategic PEO offers customized talent management services, such as recruiting, performance management and employee development, as well as tactical HR support, in areas like policies, planning, and compliance. High-tech PEOs will spoil you by providing state-of-the-art HR systems and automated tools to enhance the compatibility and effectiveness of your HR processes. Additionally, they will have a team of experienced and highly trained HR professionals that are readily available to assist with your workforce needs.

Time & Labor Tracking

Everyone knows that time is money, and an effective time and labor tracking solution will help you save both. Some PEOs provide a time tracking system that allows you and your staff to access schedules, monitor overtime, and adjust shifts at any time and from anywhere. More advanced web-based solutions can even feed information directly to payroll, making human errors disappear. And, with employee reports that comply with federal and state requirements, time and labor tracking is a piece of cake.

Payroll Services

Payroll processing is a time-intensive task that has many HR managers on pins and needles. So it’s not surprising that many businesses are quick to outsource it. Making sure a PEO offers quality online reporting will save you the headache of doing it manually.  More integrated PEOs can bundle payroll with time and labor tracking services to limit errors and expedite payroll by eliminating the need to input multiple pages of data. The most capable PEOs pair payroll specialists with high-tech systems to expertly manage the entire payroll process from start to finish. Your employees receive paychecks that are accurate and on time, so you can enjoy your morning cup(s) of coffee.

Employee Benefits Administration

Good employers do a good job of providing their staff with more than a paycheck, but offering added benefits can be expensive and difficult to administer. PEOs provide affordable benefit options like health benefits program administration, open enrollment management, invoice reconciliation and remittance to carriers, 401(k) plan management, and more, which increases employee retention; making the outsourcing decision an easy one.

Risk Management & Safety

It’s all fun and games until someone gets hurt. As with any business, there’s potential for accidents and injuries on the job. And, if mistakes or mismanagement occur, it can lead to litigation. Many risks are more manageable through a PEO. Qualified PEO professionals can reduce the stress and strain associated with workers’ compensation issues and provide tactical support in the areas of compliance and safety to you mitigate HR risks.

What Are The Benefits Of HR Outsourcing?

Whether you want to focus on growing your business, save money, or gain operational efficiencies, partnering with a PEO can help you realize these benefits and more.

Keep Your Eye on the Prize – Running Your Business

HR management is a strategic part of your business, but likely not your core business. A PEO allows you to focus on your business by decreasing the burdens and complexities that surround employees and their issues.

Handle HR Matters Correctly

When you choose to outsource HR to a PEO, you get the benefit of improved operational efficiency. PEOs do everything they are engaged in completely and thoroughly and provide experienced experts, proven processes, and sophisticated systems to manage your HR and administrative operations more easily and effectively.

Reduce Expenses – Tighten Your Belt

Reducing expenses is one of the most compelling reasons why companies outsource to a PEO. By pooling client employees to procure health insurance, workers’ compensation insurance, and other benefits, such as vision, dental, and 401(k) and other savings plans, they are able to secure highly discounted rates that won’t cost you an arm and a leg.

Get Leg Up On The Competition

In business, to be more successful than others in a competitive situation, you have to find the best and the brightest talent and offer them a competitive compensation and benefit package. PEOs have experts on staff that can assist you in this area and provide knowledgeable consultation and recommendations for hiring staff, negotiating appropriate compensation, streamlining candidate screenings, and more. Ultimately, running the table on your competition.

Sleep Better At Night

No, we don’t mean stop the fighting, though that could stand on its’ own. To keep the peace here is to prevent difficulties from occurring and provide peace of mind that your business is in compliance when it comes to managing your HR processes. Partnering with a PEO for outsourcing HR is an open and shut case. 

HR outsourcing to a PEO can take on some or all of your strategic and administrative HR functions, making managing HR pretty simple. Even when these tasks seem monumental, a PEO partnership can position you and your business for growth, at whatever speed you need.  That’s what HR outsourcing is all about.

If you’re still on the fence about HR outsourcing, learn more about the PEO industry and guidelines for selecting a PEO at the National Association of Professional Employer Organizations (NAPEO): www.NAPEO.com.

If you’re ready to find the right PEO for your business and seal the deal, learn more about our no-cost PEO consulting services.

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