What is a PEO?
A PEO is a company that focuses specifically on human resources, benefits, and employee-management tasks such as payroll, legal compliance, employee recruitment, hiring/firing, training, and related areas. PEOs also provide and administer a range of benefits, such as insurance and 401k plans. PEOs offer greater savings to clients, as they pool all their clients’ employees, which means greater purchasing power.
What is co-employment?
A PEO provides a “co-employment” business model, which means the PEO is the employer-of-record for their clients’ employees. A PEO could potentially employ thousands of employees on behalf of their business-owner clients. The PEO is the “administrative” employer, and the business owner is the “operating” employer
What is the difference between an “Administrative” employer and an “Operating” employer?
Being an “administrative” employer means the employees technically work for the PEO. However, the PEO only manages the HR function, administers employee paperwork, and navigates all the compliance requirements of having employees. The PEO assumes responsibility for the legalities of an employer.
The client retains the responsibility of being the “operating” employer, which means the employees are managed, trained, hired, fired and otherwise directed in their day-to-day work by the business itself. The business owner is 100% responsible for running and operating their businesses, and the employees who do the work for the business.
What are things a PEO DOESN’T do?
While a PEO can take over many responsibilities for their clients, they won’t take over the running of your business. It’s up to you to manage your team and your operations. Also PEOs aren’t lawyers or tax advisors (although we do provide referrals to strategic partners for these specific services). While a PEO can help with forms and filings as well as answering questions and providing insight and guidance, each company still needs to follow the laws and be responsible for compliance.
Who is a typical SustainableHR PEO client?
SustainableHR PEO is exceptionally well-suited to work with small- and mid-sized organizations around Wisconsin. Whether you have 2 employees or 200, we work with clients across industries – professional services, retail, manufacturing, nonprofits, etc.
Our typical client is one that is looking to save time, money and resources around the HR function of their business. They may not have the resources to have an internal HR department and/or want the ability to offer their employees excellent benefit options at a much more reasonable cost.
Who pays my employees as part of a PEO?
The PEO oversees the payroll function; employees are paid by the PEO. However, the client business then pays the PEO a fee to cover the employees’ wages and related benefit costs, plus an administration fee.
The fees for using SustainableHR PEO are fair, reasonable and transparent, so you will never be surprised.
How can a PEO save me money on providing benefits to my employees?
PEOs save client business both time and money. By outsourcing their HR/payroll/benefits function, businesses free up time and resources to focus on growing their team and scaling their companies. PEOs also save businesses money be allowing them to offer benefits at a reduced cost, thanks to the purchasing power of a PEO. PEOs can offer a wide range of benefit plans that a small business may not be able to afford on its own.
What if my employees have questions related to their benefits?
The PEO takes responsibility for administering employee benefits, which includes being on call for any of your employees who have questions about offerings and utilizing their benefits.
What if I don’t need the full services of a PEO, but still have some HR needs?
No problem! Through our SustainableHR services, we also provide individual services to help business owners fill in the gaps of their HR needs. Whether you need an employee handbook created or updated, a compensation study completed, help with your recruitment efforts, employee training, or general compliance questions, we’re here to help!
If I’m interested in learning more, what do I do?
That’s easy … just ask! We’re always available to provide a free consultation and answer any and all questions you have about your HR needs.