There are many PEO services, and selecting the right one for your business requires a thorough vetting process. This includes a comparison of pricing, features, and benefits.

Even the smallest businesses can benefit from someone handling their HR tasks, including payroll, workers’ compensation, and employee training. It’s also essential to understand how each PEO bills – a flat fee rate or a percentage of payroll.

Know Your Needs

Professional employer organizations take on many responsibilities of small business owners, like human resources, payroll, employee benefits, and risk management services. This allows them to free up business leaders’ time and lets them focus on growing their company. It also helps employees by giving them access to big-company benefits like 401(k) plans, wellness programs, and health, dental, life, and other insurance offerings.

When you decide to work with a PEO, it is essential to know your needs so that you can find one that meets them. You can ask business colleagues for recommendations or use online, and industry reviews to narrow down your options.

For example, suppose your most significant need is legal compliance. In that case, you should ensure that the PEO you choose has trained professionals familiar with state and federal regulations like tax structures, HR laws, and worker safety. You will also want to examine the services included in each PEO’s administrative fee. Many PEOs charge a flat fee per employee, while others will charge based on a percentage of your total payroll.

Ask for Recommendations

Many business owners don’t have the time or expertise to manage human resources, payroll, insurance, and legal compliance themselves. Finding the right PEO service providers can help take some of this burden off of you, freeing up time to focus on your core business. Luckily, there are plenty of options out there. To make the most informed choice, ask friends, colleagues, and other business leaders for recommendations or check out online reviews, testimonials, and websites.

It would help if you also asked the PEO for a list of client references, especially those similar to you in size, industry, and location. This can give you a good idea of the level of service and support you can expect.

Another essential thing to look at is the pricing structure. Some PEOs charge per employee, while others will calculate their fees as a percentage of your monthly payroll. Compare the two models to determine which one best fits your needs. Choosing the wrong one could cost you more in the long run.

Look at the Fees

It’s essential to understand how the PEO you are considering charges for its services. Some charge a flat fee rate, while others charge a percentage of payroll. Be sure you know how they calculate their fees so there are no surprises.

Ask for client references to get a feel for what the PEO is like to work with. Typically, the best PEOs will be happy to share references from clients similar in size and industry to your company.

Also, consider whether the PEO offers a technology platform that is user-friendly and easy to implement. After signing on, you don’t want to discover that the platform is challenging to use, which can increase training costs and hinder employee buy-in.

Look at the Technology

A PEO should have a comprehensive client and employee technology platform that is mobile-friendly and easy to use. The platform should include features like self-service payroll and HR management. Some companies also have dedicated support staff for customer service, which is helpful if you or your employees run into issues.

In addition, a PEO should be able to explain their pricing structure clearly. They should tell you whether they charge businesses on a per-employee basis or as a percentage of their total payroll. Some also offer a hybrid model that lets you choose the best option for your business.

Choosing the right PEO service provider can help your small business take advantage of big-business employee benefits and services without the cost and time investment involved in maintaining in-house expertise in human resources, legal, tax, and client services. Make sure you spend plenty of time evaluating the PEOs you are considering. An in-depth evaluation will help ensure that the PEO meets your business needs, budget, and culture.

Look at the Staff

As you narrow down your choices for PEOs, look for a company with customer service that exceeds your expectations. One of today’s biggest PEO providers offers personal payroll account managers and HR experts to help you manage your business and its employees. It has a robust online portal and multiple chat options for quick support.

Another consideration when choosing a PEO is how they bill their services. Many PEOs charge a flat fee rate per employee or based on a percentage of the client’s payroll. The latter is more expensive and can vary based on your company’s payroll.

A good PEO will have in-house expertise on local labor and employment laws to ensure you are compliant with all relevant rules and regulations. They also keep up to date with changes in ACA and workers’ compensation insurance requirements. This helps the client avoid fines and penalties. They also manage worker and supervisor training, ensuring compliance with mandatory safety programs. However, the client retains responsibility within the employee relationship, including hiring and firing, setting pay rates, and culture.