The Human Resources (HR) Department is potentially the most human part of any business, typically addressing staffing, development, compensation, safety, and health, and employee and labor relations. Using a highly functioning HR department can allow business executives and owners the aid that the needs of the workers are being met, and can save a business from all sorts of legal fees.
A problem that many companies face is the sheer quantity of responsibilities that are connected to the HR department, not to mention the value of these components as staffing or employee relations which could impact your company as a whole.
Many companies are Finding themselves a Professional Employer Organization or PEO to aid with those delicate responsibilities.
What is a PEO?
A PEO is a business That produces a joint-employment relationship with a business by renting employees to the company, allowing the PEO to control and support with the numerous employee-related responsibilities. This gives the company the ability to outsource their HR functions to the PEO, and ease some of the strain from the HR department.
What Can They Do?
By taking on the responsibilities of the HR department the PEO can ease any HR staff which might not have the level of experience or expertise required of them, and there are a variety of different purposes a PEO can handle.
Recruiting and Hiring
The process of vetting Potential staff members through submitting a job vacancy to conducting interviews could be costly in time, energy, and sometimes even cash. PEO’s are usually equipped with expertise and wisdom in the area of recruitment, and having them handle this element of your HR department can be an excellent way to make sure that only the finest quality possible employees are being contemplated.
Although there may be Some concern from employees that the PEO does not have an identical impact as welcoming a member to a business through preexisting employees.
Maintaining compliance Can be an ongoing battle, particularly for smaller companies, and gaining help from a PEO with compliance might enable your HR staff to concentrate on other critical aspects of the company. Breaking compliance can be incredibly costly, so making sure that compliance has been met can mitigate unnecessary costs that could put your company under.
An aspect of HR that has Been vital for the survival of an organization, using a payroll organized and being sent on time guarantees that your staff can maintain their financial security. Having a PEO handle your payroll administration can be perfect in much larger companies where you can find other significant HR responsibilities to remain on top of.
Outsourcing payroll Admin can have some level of risk, with employee paperwork being in their hands, and possible security problems with the vendor’s system. Finding a PEO which may ensure or insure their system and individuals are protected is best.
Drug Testing Programs
To ensure the efficacy Of in-house drug testing programs that the HR department might need to get uncomfortably near the employees, this may be an HR nightmare in itself. Outsourcing the drug testing programs via a PEO can guarantee that not only is the program being completed to the greatest professional level, but also your employees and HR staff may feel more familiar with how the process is performed.
On the other hand, however, This may seem somewhat impersonal to staff members, so ensuring that they understand why you have integrated a PEO to administer drug testing is crucial.
Family and Medical Leave Act Administration
The Family and Medical Leave Act (FMLA) compliance demand HR staff to know about all of the intricacies and nuances in the act’s details. For people new to HR or businesses that are near the 50-employee mark it is essential to be knowledgeable about the fundamentals of the action to ensure both the employees and the firm are being treated fairly. Having a PEO handle this part of the company can be a perfect way to make certain that the act has been enacted fairly.
This is another area Where an impartial relationship between the team and PEO can create some resistance from employees, PEO’s can normally provide instruction about this to your employees to alleviate their concerns.
Having well-managed Benefits management can ensure your employees are incentivized to work their best, in addition to attracting experienced key staff members to your company. PEO’s will frequently have formulas and strategies for benefits administration, and their help can’t just keep your employees happy but at a minimum cost to you and your company.
To PEO or Not to PEO? As you can see there are many benefits to hiring a PEO to help with your business, although there are also some drawbacks That should be considered also. Ensure That if you are going to hire a PEO to Do your due diligence and work with your existing HR staff to determine which sectors They might be struggling with