Life as a business owner is hard and requires you to master the act of juggling many tasks at once, while many different hats, figuratively speaking. Not only are you a business owner but you’re also an accountant, an HR rep, and even a marketer. The list of tasks is never-ending.
In the event that you don’t have the budget to hire a larger staff, another option to consider is a professional employer organization (PEO). The best PEO companies in New York City for small business are able to handle HR, employee benefits, and other administrative functions. In turn, you can to focus on what’s most important: growing your business.
Keep reading to learn about how a PEO service can greatly benefit your company.
Improved Human Resources Management
Managing your employees is one of the most important factors in a successful business. Because employees are a company’s most valuable asset, it’s important to always strive to provide a positive employee experience. Otherwise you risk high turnover rates. In fact, one study found that 23% of all new hires leave their company before completing a year of service. This shows just how important it is to have an effective team of HR professionals.
By hiring a PEO firm, you’ll have experts on your team who can assume all of the roles of an HR department. PEO services typically include:
- Administering employee benefits
- Keeping track of employee leave
- Filing taxes
- Workers’ compensation
With an experienced team of HR professionals, you can focus on other important parts of growing your business.
Lower Compliance Risk
Compliance is one of the most complicated parts of owning a business. With hundreds of federal, state, and local laws and regulations, it’s nearly impossible for small businesses to stay on top of all of the regulations that they must meet. Instead of taking the risk of not being compliant, by working with a PEO firm, you can greatly minimize the risk of running into potential legal or financial troubles.
PEO companies have much more time and expertise to ensuring that their customers are compliant. With the ever-changing laws related to wage and insurance claims, taxes, hiring, and benefits, it’s nice to know that you have experts on your side who are in charge of keeping your company compliant and keeping up with new and changing regulations.
As a business owner, there’s nothing better than being able to cut costs. By choosing to outsource HR and administrative work, you can save money on operational costs. Working with a PEO firm tends to be much more cost effective than hiring a full-time internal HR team. The facts are in the numbers.
The average yearly salary for a human resources manager is $66,220, and this number doesn’t include the cost of training, benefits, and equipment. For a team of a few HR professionals, you’re looking at costs of more than $120,000 a year. Depending on the size of your company and the PEO firm you choose, you may find rates as low as $150 a month for their services.
PEOs can also save money in that they have more power over negotiating lower group insurance costs along with lower state unemployment insurance and workers’ compensation discounts. Their negotiating power can save you thousands of dollars a year.
Access to the Latest Technology
As a small business, you likely don’t have the budget to keep your HR and administrative software as up-to-date as you’d like. This leaves you stuck working with outdated software that often doesn’t meet your reporting, metrics, and accessibility needs.
Instead of relying on outdated software, you can have access to the latest HR technology by hiring a PEO firm. PEO companies have access to a variety of HR technology solutions. This means that your company’s HR functions will offer new features and capabilities that you’ve likely never had access to in the past.
Ability to Focus on Your Business
As a small business owner you likely have a small team of internal resources to take charge of day-to-day operations. More often than not, HR and administrative tasks become “other duties as assigned” for employees who were hired for other purposes. This can stretch your workers thin and increases the risk of low morale and productivity.
By hiring a PEO company, you can refocus your employees on the tasks they were hired to do. A PEO eases everyone’s workload, which greatly minimizes the risk of burnout and low employee morale.
By outsourcing HR and administrative tasks to a PEO company, you can enjoy a wide range of benefits. If you’re a small business owner that is considering hiring a PEO firm, keep these advantages in mind to ensure that you’re making the best decision for your company.