Many companies benefit from the use of a PEO for their HR functions. But, among companies that don’t have experience with a PEO provider, there are many misconceptions out there about what these organizations actually do. PEOs are not used for just one specific function or one type of company, and they may be more useful for your company than you think.
Here are four top misconceptions about PEO providers.
1. A PEO provider is only for companies of a certain size.
False. Both large and small companies tend to save on costs for professional training, payroll services, and group access to healthcare and retirement through a PEO provider. For small businesses, these perks are often impossible to achieve without the help of a PEO. Looking beyond benefits, companies of all sizes can benefit from the flexibility that a PEO provides. PEOs allow a company’s HR services to grow as the business does and doesn’t just provide a one-size-fits-all solution.
2. A PEO provider just manages payroll.
False. Payroll services are a major component of a PEO provider, but there’s much more that a PEO can offer. Along with processing payroll, PEOs can offer expert compliance management, workers’ compensation, and employee performance management. Companies can use PEOs for almost any HR function or to help with major transitions. As a company grows, a PEO can help evaluate performance and find ways to grow a business. PEOs can also help companies adapt during crisis scenarios like the recent COVID-19 crisis.
3. A PEO provider isn’t necessary if we already have an HR manager.
False. A PEO provider can be used as a substitute for HR, but many companies use them as a safety supplement to their current department. PEO providers can help an HR manager stay current on employment laws and the ever-changing labor landscape. With the help of a PEO, your HR manager can give more attention to employee professional growth, recruitment, and talent retention without worrying about costly mistakes in labor law or payroll.
4. My company does not need a PEO provider now that we are remote.
False. Just because your office environment went away, it does not mean that your need for HR services did. With remote teams, there is even more to pay attention to when it comes to payroll, labor laws, and employee retention. A PEO is the perfect accompaniment to any remote transition and will ensure that your company stays on top of current laws and labor trends.
LBMC Employment Partners’ goal is to help your business be set for success. No two businesses are the same. Let us customize a plan for you. Contact us today to discuss our PEO services that can work best for you!