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A company’s Human Resources (HR) department is often responsible for everything from payroll and tax filing to legal compliance and employee benefit administration. Not only are there more HR responsibilities than ever, but statutory and regulatory burdens have gotten increasingly complex as well. You may be at a point where you are considering outsourcing one or more of your HR responsibilities to minimize risk, reduce costs, and give you the freedom and flexibility to focus on the core of your business. Regardless of your company’s size, you can gain more scalability and flexibility by outsourcing key HR functions; better yet, partner with a Certified Professional Employer Organization (CPEO) like Resourcing Edge for your HR needs.

A Professional Employer Organization (PEO) Can Help

A Professional Employer Organization (PEO)is a comprehensive and integrated solution. PEOs provide the full slate of HR services to clients. If you are seeking to outsource multiple HR services or can’t afford a standalone HR department, a PEO is a great choice.

What is a PEO?

PEOs and CPEOs operate under a co-employment model, which means that employees work for both the company and the PEO. While the business retains complete control of all business decisions and operations, the PEO is responsible for your HR-related functions, such as payroll, benefits, workers’ compensation, and more. Even if you have an existing HR department, PEOs can provide much-needed support that can free up on-site HR professionals for strategic projects rather than administrative duties.

What is an ASO?

ASO stands for Administrative Services Organization. An ASO is an alternative to a PEO. ASOs are normally used by companies with over 50 employees and are in a hiring flux. Resourcing Edge offers both PEO and ASO options to its clients.

What does a PEO provide?

  • Access to big-business benefits (health care, retirement, etc.) at lower costs
  • Specialized HR experts familiar with all aspects of human resources
  • Reduced payroll and accounting costs
  • Comprehensive employer liability management
  • Administrative duty relief

When you need a comprehensive HR outsourcing solution, you want to look at a CPEO like Resourcing Edge. A certified PEO provides similar services as a regular PEO, but must meet IRS certification requirements — tax status, background, experience, financial reporting, bonding and other requirements. A CPEO takes on the full responsibility for paying employment taxes, filing returns, and other tax-related duties. Unlike HR outsourcing companies, which may be able to provide one or two key HR functions, a PEO or CPEO can handle all of your business’s HR tasks. You won’t have to waste any more energy and attention on complicated HR procedures, nor will you have to hire additional staff.

9 Reasons Why Companies Outsource HR

1. Access to better, cheaper benefits

A PEO usually has access to a larger pool of benefit options at lower prices, including health and retirement benefits. They can lower benefit-related costs by using their collective bargaining power to negotiate lower rates.

Resourcing Edge offers clients access to Fortune-500 employee benefits plans from leading insurance carriers, such as UnitedHealthcare and MetLife. We are one of a select few PEOs that has partnered with UnitedHealthcare to offer a wide assortment of fully-insured, ACA-compliant, national medical insurance plans. We have also partnered with MetLife to provide high-quality national dental, vision, disability, and life insurance plans.

2. General relief from HR tasks

You can outsource a variety of HR duties to free up time and energy for your overburdened HR department, including:

  • Payroll administration
  • Government compliance
  • Employee benefits
  • Employer liability management

3. High-quality workers’ compensation

A PEO can also handle your workers’ compensation claims, including communication and assistance with return-to-work programs. A good PEO will also offer other safety and risk management services, including:

  • Workers’ compensation insurance
  • Claims management
  • On-site safety reviews and trainings
  • Safety materials
  • State and federal compliance posters
  • Premium payment and reconciliation
  • Post-accident drug testing
  • Drug free workplace program
  • Accident investigation
  • Certificates of insurance
  • Light duty program

If you don’t have workers’ comp coverage, you could be at risk of fines, penalties, and lawsuits. With the increased liabilities facing small businesses, your PEO can be a safeguard for those looking to increase revenue, expand business, and reduce risk. Working with a PEO reduces injuries in the workplace while lowering your workers’ compensation coverage and premiums.

4. Freedom from payroll pains

Take the stress out of hiring and paying employees by outsourcing your payroll responsibilities. In addition to processing payroll and issuing paychecks, a PEO also assumes the risk and responsibility of record-keeping requirements, wage and hour compliance, regulatory reporting, and other burdens of payroll management. Payroll administration services include:

  • Web-based payroll services (employee and client access)
  • Real-time detailed reporting and new hire reporting
  • Tax filing deposits and direct deposit
  • Paid time off

A PEO also handles all payroll tax withholdings and benefit plan contributions. Because a PEO uses its EIN to prepare, file, and deposit payroll taxes, a PEO assumes full responsibility with state and federal laws.

5. Reduced regulatory and legal administrative burdens

With a PEO, you can reduce risk and costs associated with things like:

  • Payroll processing
  • Maintaining wage records
  • Tax reporting and deposits
  • Paycheck/paystub preparation and delivery
  • Wage garnishments

6. Assistance with federal and state employment laws and regulations

 A PEO can assist with the following:

  • Payroll
  • Unemployment claims
  • Employment verifications
  • Compliance with all federal, state, and local laws affecting PEO responsibilities
  • Guide for OSHA, ADA, and many other government statutes and regulations
  • Health care compliance

There are more laws, statutes, and regulations that affect human resource practices than ever before. In the 80s, we only had to deal with a dozen or so statutes and regulations. Now, there are about six times as many, including the Americans with Disabilities Act (ADA) and Family Medical Leave Act (FMLA). Given the increasing complexity of compliance-related issues, it’s important to have HR specialists available to assist with HR-related challenges — strategic, financial, operational, legal, and more.

7. Single point of contact

At Resourcing Edge, you are assigned a single point of contact to simplify communications. You will have direct access to your point person for any questions or concerns you may have.

8. Reduced liability

PEOs are under pressure to keep your business in the green, assisting you with HR-related responsibilities, such as:

  • Employee hiring
  • Employee handbooks
  • Employee benefits
  • Workers’ compensation
  • Legal compliance assistance (harassment, discrimination, immigration, etc.)
  • Professional training (sexual harassment, safety, etc.)
  • Government liaison

9. Access to HR specialists in every department

A CPEO like Resourcing Edge will have specialists in every aspect of human resources and can be trusted to provide sound advice and guidance, including:

  • Risk and compliance
  • Employee relations
  • Liability training
  • Equal Employment Opportunity Commission (EEOC) claims investigation, reporting, and mediation

A PEO will be able to handle your HR-related tasks so you can focus on scalability and profitability instead of paperwork.

Why Do Companies Outsource HR Functions to a PEO?

At this point, the answer to this question is simple. Companies outsource HR functions in order to spend less time on daily HR to-dos and more time on the business decisions that affect the bottom line. According to recent NAPEO surveys, the most common business challenges include:

  • Hiring new employees
  • Health care
  • Taxes and regulations
  • Attracting new clients
  • Growing the size of the business

The top concerns of business owners are exactly the types of issues PEOs focus on. Businesses that outsource their HR functions to a CPEO experience less risk, more profit, and happier, more productive employees.

How Resourcing Edge Can Give You the Competitive Edge

With a certified, accredited, and bonded PEO like Resourcing Edge, you’ll have access to big-business benefits from leading insurance carriers, such as UnitedHealthcare and MetLife. You’ll also have full access to our robust technology platform with separate employee and employer self-service portals.

Gain the competitive edge with the power of a CPEO like Resourcing Edge. For more information on HR outsourcing, don’t hesitate to contact Resourcing Edge.

Shellie Rich

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