Hot trend in business

Connie Laughlin

What’s hot is a new trend in the way we do business. The outsourcing of non-core human resource duties, such as; payroll administration (including tax payments), workers’ compensation (including professional claims management), risk management, unemployment claims management, and last but not least a professional safety program.

Companies in this industry are called Professional Employer Organizations, or PEO’s. They are affordable and a highly effective solution.

Not only is outsourcing HR HOT now, studies by JP Morgan and others expect significant growth ahead. It’s like the forefront of wireless or the PC revolution in the early 80’s. Before long, we should see it as a common business practice.

This new revolution in business is not really so new, the business has just progressed to be much more solution based than it was in the old staff leasing days.

How would a business leader know if they’re selecting the right company to partner with? Carefully examine the PEO’s financial standings – this is extremely important as the PEO is entrusted to handle your payroll taxes, workers’ compensation and unemployment taxes. Does the Professional Employer Organization exceed industry standards by obtaining industry certifications as set by the industry organization NAPEO (National Association of Professional Employer Organization)? Verify certifications and licensing’s.

Industry Practices To Look For When Selecting a PEO
Ask specifics! Where is their headquarters? It can be very frustrating to work with representatives that you’ve never met in person that are located across the state or country.

Is paperless payroll available (online reporting, direct deposit, and pay cards for employees without bank accounts)? What kind of payroll solutions are they willing to provide as you grow your company or how can they help streamline your present means of reporting payroll. Many sophisticated (in-the-field) time accounting models don’t work and some do.

Risk Management - a highly qualified PEO has strategies in place to minimize your company’s exposure to loss through work-site injury or employment litigation. You should find a PEO with a light-duty program in place that reduces the cost of claims.

Which insurance carrier provides the PEO’s workers’ compensation insurance or better yet is the PEO certified self-insured? Find out the amount of coverage provided through the policy. A PEO that is certified self-insured could provide the best solution and stronger more efficient claims management, again reducing the cost of claims.

What about benefits? What are the group health plan options, how are they funded, and how are the monthly premiums paid (in advance or pay-as-you-go)?

Superior human resource service is another strong point. Will the PEO provide employee handbooks based on your company’s policies? Will there be HR training for employees and managers? Do they provide advice and assistance with issues such as; hiring, terminations, discipline, grievance, and a host of other things?

Look for safety directors certified as a National Safety and Health Officer and the PEO’s safety team should be actual employees of the PEO, not third party employees. Their safety program should consist of on-site inspections, training, manuals, and practice audits, accident reporting, and scheduled safety training.

Look for a PEO with management staffs of experienced, educated, and certified professionals. Is the PEO active in influencing legislation important to Texas employers? Is the PEO Texas based and well versed in Texas employment and payday laws? Is the company too big, too small, or just the right size to provide superior customer service?

For a closer look at the PEO industry and to see if it’s right for you and your business call or email Connie Laughlin for more information. Connie can be reached at (800) 824-8367 or at conniel@uniquehr.com. Website: www.uniquehr.com