Many businesses already know the advantages of outsourcing their HR services to a Professional Employer Organization, but how do you know which one to choose? How can you be sure a PEO is reputable and trustworthy?
When selecting a PEO to handle crucial HR functions, such as payroll, workers’ compensation, employee benefits, and employment law compliance, you want to verify that they are both IRS certified (CPEO) and ESAC accredited.
While IRS certification focuses on things like employment wages, state, local, and federal employment taxes, ESAC provides independent verification of all key areas of PEO reliability, including demonstration of liability insurance coverage, financial stability, and more.
Resourcing Edge is proud to be among the top 5% of PEOs who are IRS certified and ESAC accredited.
· Verify Resourcing Edge’s IRS certification.
· Verify Resourcing Edge’s ESAC accreditation.
What Is ESAC?
The Employer Services Assurance Corporation, developed by the National Association of Professional Employer Organizations in 1994, is an independent, nonprofit accreditation and financial assurance organization for the PEO industry.
ESAC accreditation lets you know that the PEO is financially stable and conducts business ethically, similar to the Federal Deposit Insurance Corporation for the banking industry.
ESAC monitors PEOs on an ongoing basis to make sure they adhere to operational standards and regulatory requirements, including:
- Financial stability
- Ethical business practices
- Adherence to regulatory requirements
- Verification of tax payments, benefit contributions, and insurance premiums
ESAC-accredited PEOs undergo continuous monitoring throughout the year to ensure proper business conduct and compliance with operational standards and state and federal laws. This includes quarterly verification of appropriate tax payments, benefit contributions, and insurance premiums by an independent certified public accountant.
ESAC also provides millions of dollars worth of financial assurance in the form of surety bonds for PEO clients. This gives PEO clients peace of mind that the PEO will properly perform their key obligations, such as payment of wages, employee benefits, insurance premiums, and payroll taxes.
Key Features of ESAC Accreditation
All clients and employees of the PEO are covered under common ownership control.
Quarterly independent CPA verification of PEO’s payment:
- Federal employment taxes
- State and local employment taxes
- Retirement plan contributions
- Health insurance premiums
- Workers’ compensation premiums
Additional requirements:
- Controlling person background check
- Annual audited financial statements
- Quarterly independent verification of financial standards
- Verification of licensing/registration in all states of operation
- Verification of compliance with over 40 important PEO financial, ethical, and operation standards
PEO regulatory advantages:
Certification and bonding accepted in lieu of all or part of state PEO registration/licensing requirements (20 states as of April 2017).
Surety bond amounts and coverage:
- $250K to $1M per PEO depending on PEO size plus $15M excess bond
- Federal employment taxes
- State employment taxes
- Contributions to retirement plans
- Insurance premiums (medical, dental, vision, disability, life, workers’ compensation)
- Employee wages
Source: Employer Services Assurance Corporation
Resourcing Edge completed a rigorous process to meet the contractual, operational, and financial standards to qualify for accreditation by ESAC. Only 5% of PEOs in the nation are ESAC accredited. We are proud to be one of those rare, accredited PEOs that have completed a rigorous process to meet the ethical, operational, and financial ESAC standards to qualify for accreditation.
Learn more about our certifications and accreditations.
Gain the Competitive Edge with Resourcing Edge
Outsourcing HR responsibilities to a PEO is a well-established practice for industries of all types and sizes to save money, improve compliance, and optimize the administration of everything from payroll and taxes to hiring and benefits.
In addition to taking over key HR responsibilities for their clients, PEOs are able to provide expert advice on everything from workplace diversity and training to employment law and maintaining secure, up-to-date information. An accredited CPEO like Resourcing Edge is designed to address the main obstacles to business success.
We take the time to understand the ins and outs of your business. This allows us to create solutions that fit your business’s specific needs. We believe this is why our clients have so much success with us.
There are good PEOs and there are bad PEOs. A certified and accredited PEO demonstrates that the PEO entity meets the industry’s highest standards and has the experience and financial stability to meet the clients’ needs. Gain peace of mind knowing that Resourcing Edge is both IRS certified and ESAC accredited.
Gain the competitive edge with Resourcing Edge’s full spectrum of HR, payroll, and benefits solutions, freeing you up to focus on growing your business.
Want to learn more about partnering with a PEO? Call (877) 703-8010 or email mailto:info@resourcingedge.com for more information.
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