Choosing a PEO services company can be a very savvy move for a small business. No matter how small a business is, it has to ensure that payroll is on time and correct, that taxes are calculated and withheld correctly, and that the company remains in compliance with a wide range of business regulations, from OSHA to EEOC to ACA. Hiring one or more employees to manage these major tasks is often impractical for a small business, and that’s where PEOs enter the picture.
The benefits of working with a PEO are significant. A small company with a good PEO relationship can be confident payroll and taxes are correct, that all regulations are complied with, and that it can offer competitive benefits to employees – things that are challenging for many small businesses. But it’s important to choose the right PEO, because they differ in important ways, and the right PEO for the business down the street may not be right for your business. When choosing a PEO services company, avoid these common mistakes to maximize return on your PEO investment.
Not Checking Out Your PEO’s Professional Providers
PEOs obviously have solid in-house teams to handle client needs with expertise and professionalism. But they also have their own network of providers and advisors that may include certified public accountants, insurance providers, and legal counsel, even when their in-house team is responsible for most of these functions. There are times when a PEO requires specialist advice, and knowing that the PEO you choose has access to an excellent network of professional specialists increases confidence in your PEO’s determination to do things right.
Choosing a PEO Where Risk Management Isn’t a Top Priority
You may think that you’re choosing a PEO to take care of payroll, but what you’re ultimately doing is choosing a PEO to better manage risk, such as risk of payroll errors, risk of workers’ comp mistakes, or risk of regulatory noncompliance. Therefore, the PEO you select should place top priority on risk management and be able to demonstrate to you how it ensures accuracy and adherence to all applicable federal, state, and local laws and regulations. Many PEOs employ certified risk managers, and this is a good sign that a PEO takes risk management seriously.
Working With a PEO That Skimps on Its Own Internal Training
The number of laws and regulations that PEOs have to stay abreast of is astonishing, and the fact that many of these laws and regulations change frequently makes the task even more complex. PEOs that are fully committed to excellence have strong training provisions for their own employees, to ensure they all remain up to date and informed about the practices, policies, and procedures that are necessary to provide the services that their clients demand. Ask the PEOs on your short list about their training practices.
Picking a PEO Without Multiple Contact Channels
Access and communication are critical in today’s business world, whether you provide dog grooming services or electrical contracting. Your PEO should offer you multiple means of contacting them and of monitoring your account with them. That means they should make available an online access portal so you can conduct basic transactions and view your account status conveniently. They should also provide a toll-free phone number, and respond to your phone calls and emails promptly and professionally.
The Right Way to Choose a PEO Partner
Choosing a PEO services provider is a big step, but one that can help your small business thrive. Knowing what to avoid is just as important as knowing what to look for. At SourceOne Partners, we can help. With over 50 years of combined experience in the payroll and PEO industries, we assist small businesses with the many intricacies involved in choosing the best PEO, from performing cost-benefit analyses to explaining exactly how various PEOs calculate costs. With offices in Florida and New Jersey, SourceOne Partners is able to work with businesses in every state, helping them make one of a small business’s most important decisions: which PEO is the best fit for their needs. Call us at 561-674-0748 or contact us online to speak with a PEO expert about your business needs.