Business owners and their management teams understand the many complexities of running a small to mid-sized business. When you launch a business, it is a desire to branch out on your own, build something for yourself and your family, chase a dream, make an impact, or change lives that inspires you to take the leap of faith and start a company.
Business owners don’t start their business because of a yearning to handle HR administrative issues, deal with payroll and payroll taxes, tackle benefits administration, keep track of employment laws, or spend their days worrying about the never-ending and ever-changing gauntlet of complex regulatory and compliance issues that businesses face each and every day. Keeping up with the many administrative burdens that come along with running a successful business can be daunting and keep you from being able to focus on your core business.
What if there was a way to minimize the stresses and burdens that come along with the HR side of running your business and employing people? A Professional Employer Organization may be the answer that you’re looking for.
Partnering with a Professional Employer Organization, or PEO, allows you to outsource many of the tedious, time consuming, non-revenue generating tasks that are a necessary part of running a successful business, giving you the time back that you need to focus on the revenue generating aspects of your business.
A PEO, or Professional Employer Organization, is an HR outsourcing solution that allows small and mid-sized businesses to shift many of the administrative burdens that bog their businesses down, over to a company that truly understands and knows how to handle the many complexities of employing people.
A PEO’s purpose is to handle the myriad of HR administrative issues that often prevent business owners and their managers from focusing on their core business and the revenue generating aspects that are essential to running and growing a company. PEO’s employ highly trained and skilled professionals in the areas of HR, employment law, compliance, risk management and more, who understand and know how to handle the complexities of employing people. They keep up with the everchanging landscape of employment responsibilities and HR related administrative burdens, so that the business owners and their teams can focus on what they’re good at.
Partnering with a PEO allows your business to shift many of the non-revenue producing tasks over to the PEO, so that you can focus on the things that grow and generate income for your business.
When you decide to work with a PEO, you will enter into a co-employment relationship with the PEO.
In the co-employment relationship, you will continue to employ your employees and serve as the worksite employer. You maintain full control of your company and workforce, and will continue to make the day-to-day business decisions for your company with regards to operations, sales, marketing, personnel, wages, business strategy, customer service and customer relationships, hiring and managing employees, etc. The PEO will become a co-employer and act as the administrative employer. The PEO will take on many of the administrative responsibilities associated with employing your employees in the areas of HR, payroll, benefits administration, compliance, and more. The PEO becomes the employer of record for payroll tax purposes, and handles wages and withholdings, issues W-2’s, and processes and remits state and federal payroll taxes due under its EIN. The PEO now has direct responsibilities for these payroll related functions, worker’s compensation insurance, benefits administration, and HR administration.
The co-employment relationship not only relieves the client of many of the administrative burdens that bog them down and keep them from focusing on their core business, but it also shifts many employer responsibilities and risks to the PEO, which limits your exposure to some of the employment liabilities associated with employing your workforce that you would otherwise be responsible for and exposed to. A Client Service Agreement, or CSA, will outline the rights and responsibilities of both the PEO and the client employer.
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