Picture this: You’re a small business owner, and you’ve got your hands full juggling everything from sales to operations, payroll, and hiring. Now imagine you could offload all that HR chaos to someone else while keeping your focus on what really matters—growing your business. Sounds like a dream, right?
Well, that’s exactly what a PEO (Professional Employer Organization) does! Instead of trying to be an HR expert, you can team up with a PEO to handle all those tedious, time-consuming HR tasks. Think of it like an HR co-pilot for your business, so you don’t crash into compliance nightmares or drown in paperwork. Let’s dive into why PEOs may be the sidekick your business didn’t know it needed.
PEO 101:
In the simplest terms, a PEO is a company that helps small and medium-sized businesses by handling all the HR stuff—payroll, benefits, tax filings, compliance, workers’ comp, and more. The PEO becomes the “employer of record” for your employees when it comes to taxes and legal matters, while you keep control over how you manage them day-to-day.
You’re pooling resources with other small businesses to get the power and benefits that are usually reserved for enterprise organizations.
Why Should You Care About a PEO?
Let’s look at some reasons why partnering with a PEO might just be the right move to make this year:
1. Get Big-Business Benefits Without Breaking the Bank
Health insurance, 401(k)s, dental, vision—it’s all expensive. As a small business, negotiating good rates is like bringing a butter knife to a sword fight. With a PEO, you get access to large-group benefits at better prices. You’re leveraging the buying power of hundreds or even thousands of employees, which means better options for your team without blowing your budget.
2. No More Compliance Headaches
Nothing is changing faster than technology and government regulations. With a PEO, you don’t have to stress. They handle all that for you. That’s right: federal, state, and local payroll taxes are done for you, on time, and accurately. The PEOs we partner with also provide great technology!
Employment laws are constantly changing—wage laws, overtime rules, ACA compliance, you name it. Trying to keep up with all those changes? PEOs have experts in-house who make sure your business is always compliant with the latest regulations. That means you’re less likely to get hit with a surprise audit or fine from the Department of Labor.
3. Focus on Growing Your Business
As a business owner, your time is valuable. Every hour you spend processing payroll, managing employee benefits, or filing taxes is time you’re not spending building your brand or closing sales. With a PEO, you get to delegate all that admin work, leaving you with more time to focus on the big picture.
Is This too Good to be True?
We know what you’re thinking: “This sounds awesome, but what’s the catch?” Like anything, PEOs aren’t a one-size-fits-all solution, so here’s the deal:
1. It’s Not Free
PEOs charge a fee for their services, usually either a flat rate per employee or a percentage of your payroll. It can be a great fit, but we need to take a close look at your growth plans and overall benefit strategy. With Pursuit we evaluate PEO’s and other options so you can feel confident about the investment and ROI.
2. You’re in a Co-Employment Relationship
When you sign up with a PEO, you’re entering a co-employment agreement. This means that the PEO technically becomes the employer of record for tax and legal purposes, while you maintain control over daily operations. Some business owners feel nervous about this, but don’t worry—you’re still the boss in every way that matters!
3. Not Always the Best Fit for Every Business
While PEOs are great for many industries, they’re not always the perfect fit. If you’re in a highly specialized field or have specific needs that a PEO can’t accommodate, it might not be the best option for you. But hey, that’s why with Pursuit we are the only company that presents all your options—like small group health insurance or ICHRA plans. The key is finding what works for your business.
Want to evaluate if a PEO is right for you?
Let’s set some time to connect and chat through your situation and run the numbers.
