What, exactly, is a PEO? PEO stands for ?professional employer organization.? It?s a relationship in which a business hands over certain human resource management services to an administrative partner. This allows businesses to concentrate on the ?business? aspect of actually running their business, without dropping the ball on important aspects of making sure employees are happy.
PEO Service: Allows More Focus on Actual Business Operations
A PEO service may handle administrative details such as making sure employees have access to their healthcare, making sure that healthcare procedures are properly followed and observed, training employees when necessary, and managing payroll benefits and related expenses.
Why Does Any Business Pay for Something it Could Handle Itself?
A small business might ask itself: Why do I need to pay someone else to manage this for me? The truth is, payroll and related management issues can be legally quite tricky, and ignorance of the law isn?t an excuse for accidentally breaking the law — leaving businesses open to liability issues if they aren?t 100% up to date on current regulations.
Right now, for example, there are over 190 regulatory legislative requirements that apply to payroll processing for Canadian employees. In the U.S., the IRS estimates that more than two in five small businesses pay over $800 in penalties each year — and tax regulations in the U.S. are generally considered to be more straightforward than in Canada! Once you outsource payroll processing, there is simple one report to approve — and a single invoice to pay for.
What to Look for in a Payroll Service Provider
When it comes to outsourced payroll solutions, what should you keep in mind? To begin with, you?re going to want to work with a company very familiar with the operations of a small business similar to yours. This means they?ll have daily experience working with the type of employees you?ve hired, and they?ll be able to advise you quickly and informatively anytime you have a question about your online payroll solutions.
What else? An experienced payroll company will be able to keep your employees? data extremely secure. This, like complying with government regulations, is extremely important because messing up could have a negative impact on your business.
Ultimately, the benefits of outsourcing are clear: your company will save time, eliminate the potential for payroll mistakes, concentrate on your core services or products, and you’ll be taking on less risk.