Professional employer organization (PEO), or in our firm, we prefer the term “wage-hosting” as it is more straightforward in describing the meaning of the words. Basically, PEO is the work of hiring and hosting staff locally on behalf of the clients.
PEO services can help businesses to take over some works such as payroll processing, taxes, employee benefits management, and also recruitment. In fact, using a PEO/ wage-hosting service is like outsourcing all your HR needs to another company.
To be more specific, the Professional employer organization (PEO) offering may include human resource consulting, payroll processing, employer payroll tax filing, social healthcare contributions, employees’ compensation insurance, employers’ practice and liability insurance (EPLI), training and development. In the aspect of recruitment, the PEO solutions can support the businesses to source employees, hire them and decide what to pay for them.
Technically, the businesses retain essential management control over the work performed by their hired employees. The PEO, meanwhile, takes responsibility for works like making wages and employment taxes reports. The main responsibility of the businesses is performing a payment to the PEO to cover the payroll, taxes, benefits, and administrative fees, and the PEO will do the rest.
1. How could PEO benefits your business?
HR challenges, somehow, can be an obstacle to your business’ development. According to research conducted by The National Association of Professional Employer Organizations (NAPEO), businesses in a PEO arrangement grow 7-9% faster, have 10-14% lower turnover, and are 50% less likely to go out of business. In most of the cases, when you cooperate with a PEO, that company can provide you the infrastructure, and resources. Therefore, it helps to save time, so that you can focus on growing your business.
Professional employer organization (PEO), or wage-hosting solutions can offer the businesses lower costs, reduced paperwork, and increased efficiency. It enhances as well as retirement, healthcare, and workers’ compensation packages for their employees.
It also takes less time and more chances for a company to leave the country, have an entity close, or establish their own firm through the already existing staff. Here are some summarized PEO advantages when you decide to apply the service.
Wide variety of employee benefits
By using PEO, your employees are grouped together with the rest of the outsourcing firm’s co-employees to form one large group. This means that your employees are able to gain access to big-business benefits, even though they work for a much smaller operation. This can help you recruit better and attract more talents for your organization.
Protect against risks
PEO can also keep your business informed of important federal and state labor laws that might affect you if you have a remote workforce. Also, it can connect your employees to the resources they need, so they can stay happy and healthy in a remote work environment.
Cost savings through hiring
When your business works on the recruitment, utilizing the PEO solutions can help you to solve the math. Not only do PEOs help their customer companies save time. They can also help you save money through consulting the ideal recruitment process and better hiring practices that fit your unique business, or designing and conducting employee performance appraisals regularly.
Strategic HR support and planning
Professional employer organization can help you develop a strategic HR plan allowing you to make HR management decisions. As the result, it will support the future direction and growth of your organization.
2. Final thoughts
Having another company step in as an administrative co-employer is a great way to break free from many responsibilities that would be too complicated or time-consuming. By using PEO, you can move HR obligations off your mental load, knowing that they bring as much care, expertise, and dependability into the relationship with your employees as you do.
Time and effort are required to gain a deep understanding of the business environment and legal practices in Southeast Asian markets particularly, and worldwide generally. At SOA, we have all the solutions for you, including a full package of wage-hosting.
With our expertise and long experience in hiring and performing HR management, we can make sure all your HR-related needs are met under our own local company. Feel free to contact us for more information about the service or ask any questions that you urge to know the answers to. We are here to get you there!
