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How a PEO Can Support All Your Human Resources Needs

In the evolving modern workplace employees are bound to have conflicts with their employer. Think about it, have you ever had a conversation with a friend who was upset about a situation that happened to them at work and suggested that they should address it with their Human Resources department to resolve it?

Business concept of successful team leader and human resource

While that’s some very sound advice, there are lots of people out there who work for companies where human resources is nonexistent or they unsure of what role Human Resources can help them with. In most cases, that’s typically because their company is a smaller operation and can’t necessarily afford to hire an HR professional, which can run an average of $65,000+ per year depending on their experience. That’s a big chunk of change for a small business!

However, by not having an HR department, companies are taking a major risk and opening their company up to potential legal troubles or worse, said Patrick Moraites, partner, and VP at Tampa-based Axis Group.

“The exposures are more prevalent than ever in today’s workplace. You’ve got wrongful termination, you’ve got sexual harassment, you’ve got discrimination, and that’s just the start of the ever long list” Moraites said. “And without an HR professional to help guide you through these complicated issues, your company is left wide open for liabilities and potential lawsuits.”

Fortunately, for small businesses that want to protect themselves have access to a powerful and cost-effective ally in a PEO. A PEO, or Professional Employer Organization, is a single-source provider of integrated business services that allows owners to outsource their human resources tasks, among other things such as workers compensation, payroll processing, employee benefits, administrative tasks, and various insurance coverages.

One of the major benefits to hiring a PEO is that you have access to a dedicated Human Resources professional who can handle all the employee-related documentation, which can be extremely time-consuming and complex. And if it’s not done correctly, there can be serious consequences and a costly fallout.

“Let’s say you have an employee named Sally who is a no call, no show one day. It doesn’t mean you can necessarily fire Sally,” Moraites said. “But if you have an HR person who can document her track record and look to see if she’s been warned about this before, they can help guide you through what you can and cannot do from a legal standpoint.”

Plus, because the PEO would share liability as Sally’s co-employer should she come back with a wrongful termination suit, it means the PEO has an extra incentive to do things by the book.

“It’s in their best interest to support the worksite employer, maintain compliance and do things ethically and legally,” Moraites said.

In addition to liability-related matters, one of the major benefits of hiring a PEO has to do with technology. PEOs provide their clients with a web-based tool known as a Human Resources Information System (HRIS). This tool is beneficial for both employers and employees in lots of ways. For employers, it can help with record keeping including PTO requests and onboarding and termination of employees. Plus, it gives them access to detailed reporting systems. On the employee side of things, it can make it easier to manage direct deposits, request time off and review the employee handbook. (And speaking of the employee handbook, the PEO’s HR person can create that, too.)

Having technology that helps with these back-end functions along with the support of a dedicated HR professional means that companies aren’t saddled with the drudgery of managing paperwork and compliance and can instead focus on the fun stuff. That means that on an employee’s first day, it won’t be all about filling out tax forms – the employer will be able to talk about company culture and get the new team member excited about being there. It also means that the employer can hand off trainings regarding sexual harassment and discrimination – things that employees rarely enjoy – to their PEO-provided HR person.

In this case, not having an on-staff HR professional can be a good thing, Moraites said.

“If you see your HR person every day and she’s giving your employees training, they may not take it as seriously as they should,” said Moraites, who noted that some states such as New York have requirements in place mandating annual sexual harassment training. “But if you have someone from the outside who’s coming in, they’re likely to be more attentive.”

In other words, they’ll probably treat that person a lot better than the staff of The Office treated Toby.

And even if your company is larger and does have a dedicated HR professional, having another expert in your field to turn to for guidance never hurts anything. This is especially true these days when rules and regulations are changing so fast, Moraites said.

“They can call the PEO and run their thoughts by the HR person there to see if they’re on the same page,” Moraites said. “It’s always nice to have a peer to give you peace of mind.”

Overall, when it’s all said and done, the benefits of hiring a PEO to manage your HR functions can pay off in a big way in terms of keeping employees happy and loyal while ensuring you’re legally protected.

“If you’re a small business without an HR department, a PEO is definitely something worth checking into,” Moraites said. “It could be one of the best decisions you make.”

Ready to learn more about how a PEO can support your company from a human resources standpoint? The team at Axis Group is here to help. Contact us today to schedule a consultation.

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