The job of an HR professional is extensive. A typical HR department is responsible for recruitment, payroll, attendance management, performance reviews, and employee relations, just to name a few. Most of these responsibilities are complex, multi-faceted, and require a tremendous amount of paperwork and tedious administration.
If you are a medium-to-small business, these tasks could be compounded by the lack of staff in the HR department. Some small businesses have an HR "department" that consists of one person, with all of the HR-administration falling on that one individual's shoulders. If your HR staff is overextended, a Professional Employer Organization (PEO) could provide the support they need to maximize their time and skills.
A PEO provides a business with several services such as:
Human resources: I-9 compliance, customized employee handbooks, leave of absence administration, unemployment claims administration
Payroll services: Tax reporting and payments, preparation and distribution of W-2s and 1099s, commission reports, earnings reports
Benefits: Medical, dental and vision, supplemental insurance, Flexible Spending Accounts (FSA)
Workers' Compensation: Shared coverage through a master insurance plan, provide certificates of insurance, claims management, accident reporting and investigations
Risk Management: Safety training, OSHA training, onsite assistance to review safety conditions
As you can see, an HR staff could benefit exponentially from partnering with a PEO. Below are just four of the countless ways that a PEO can support your HR staff.
1. Provide guidance on laws and labor regulations
Your company is responsible for adhering to all labor laws and regulations. These laws can vary based on the number of hours your employees work, the type of industry in which you operate, the age of your employees, and the total overall number of employees you have, among other things. There are more than 180 laws administered and enforced by the United States Department of Labor (DOL), and your business is expected to know, understand, and adhere to every one of them. PEOs provide expertise on labor laws and regulations that your business needs to abide by. Laws and regulations change rapidly, and it can be a full-time job just keeping up with the changes. A PEO can serve as a knowledgeable consultant, and also help your HR staff by taking care of the administrative functions, including government reporting, claims, and taxes.
2. Reduce your liability
In the same capacity that a PEO can provide guidance and assistance with helping your business adhere to laws and regulations, they can reduce your liability by doing so. For example, if you violate, even unintentionally, any one of the U.S. Equal Employment Opportunity Commission discrimination laws—age, race, gender, religion, disability, etc.—your business is susceptible to lawsuits and a tarnished reputation. A PEO can take a bird's eye view of all aspects of your HR operations to assist you in complying with the myriad of laws and regulations affecting your workplace, as well as set up regular monitoring of your business.
3. Free up HR's time, so they can focus on other tasks
It can be difficult to rate the level of importance of an HR professional's responsibilities. It's imperative that they manage your business' payroll, benefits, risks, etc., but just as important that they focus on successful recruitment and employee relations. Your employees are the face of your company, and if you don't have an HR staff dedicated to ensuring you hire and retain the best and brightest, your business may suffer. Outsourced human resources services can free up your HR staff from some of the mundane and tedious administrative functions, allowing them to focus on recruiting, retaining key staff, and maintaining employee relations.
4. Give HR staff access to information and resources
Your HR staff is responsible for wearing many hats. They are expected to keep your business compliant, provide world-class training, and recruit qualified employees. In order to do any one of these tasks—each of which comes with its own set of tasks—they need access to a wealth of information. By partnering with a PEO, your HR staff, and ultimately your business, gains access to resources such as e-learning courses, safety training, leadership training, on-site seminars, best practices, customized handbooks, and updates on laws and regulations.
You give your employees tools to help them perform their jobs. They may need a computer, a forklift, medical equipment, etc., depending on their role and your industry. Your HR staff also needs tools in order to be successful. A PEO is simply a resource and tool that your HR staff should not do without. With a PEO, your business reaps the benefits of mitigated risk and improved employee relations. It gives you the time to focus on revenue-generation and other growth initiatives.