Thursday, June 30, 2011

Do you and/or your company understand how to properly manage your Payroll, Workers Compensation, Human Resources, Risk Management, and/or Employee Benefits? Is a Professional Employment Organization (PEO) the Answer?

Professional Employment Organizations (PEOs) or employee leasing companies are organizations that help other businesses by offering a number of valuable services to their customers. In general, PEOs provide organizations with payroll services, access to workers compensation policies, help in managing their human resources, risk management (i.e. employee manuals and other services), which at times may be difficult for these same organizations to manage on their own. As a result of this more efficient way of managing workplace processes and workplace safety, companies can further reduce administration costs while remaining focused on their core business strategy. PEOs also help companies gain more control over their costs of worker compensation coverage since most of the time workers’ comp rates are based on actual hours worked, so a company is exactly even every week and the worry of tax penalty goes away because the PEO pays all the state and federal taxes.

Additionally, most PEOs help organizations with their hiring practices by attracting and retaining good employees, while reducing their employee turnover and unemployment compensation claims, which is critical in today’s working environment. Because most employee leasing companies also represent a number of different employers these companies usually have access to a larger pool of workers. In turn, having access to a larger pool of workers can sometimes help lower the costs associated with certain employee benefits such as health and dental insurance, supplemental insurance, and even 401(k) retirement plans, which many companies cannot afford individually but now can because of the buying power of an employee leasing company (U.S. Department of Labor).

The National Association of Professional Employer Organizations (NAPEO) Financial Ratio and Operating Statistics Survey (2010) found, “that 2-3 million Americans are currently co-employed in a PEO arrangement. About 700 PEOs that offer a wide array of employment services and benefits are operating today in 50 states. PEOs have an 88 percent client retention rate due to strong client satisfaction.” If you would like more information on Employee Leasing or Payroll Companies you can email or call me personally at 813-474-2705 to discuss how you continue to remain focused on growing your bottom line, so you have a competitive advantage over your competition.

Otherwise, please feel free to post any additional questions or comments, as I continue to collect real world research on how new technological advancements are helping to shape the future of Small-to-Medium Enterprises (SMEs). Until next time, keep smiling, and thanks for stopping by :)

National Association of Professional Employer Organizations (2010). What is a PEO? Industry Statistics. PEO Industry Statistics, retrieved on June 26, 2011 from: /

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