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Will your company benefit from a PEO?

Posted by: on February 27, 2017 in Human Resources PEO


Have too much on your plate? No one runs your business better than you, so focus on that. Say goodbye to administrative burdens and say hello to cost-effect HR management with a PEO.

A PEO or Professional Employers Organization is a much easier and more effective way of managing virtually every facet of Human Resources. Even businesses that are currently outsourcing one or two HR functions, such as payroll, through a conventional outsourcer have a lot to gain by consolidating other HR administrative functions with a PEO. Hand off the Headaches of Payroll, HR, and compliance to a PEO and focus on growing your business!

Advantages of Businesses that use a Professional Employer Organization
  • 50% less likely to go out of business
  • 7-9%faster growth
  • 10-14% lower employee turnover
Professional Employer Organizations: Keeping Turnover Low and Survival High|McBassi&Company|2014

The Right PEO for Your Business
PEOs come in all shapes and sizes, with some focusing on specific industry verticals and/or geographic regions and others offering broad coverage on a national basis. While individual needs and circumstances should be considered when choosing a PEO, the National Association of Professional Employer Organizations (NAPEO) offers a set of general guidelines that can help you get started:

  1. Assess your workplace to determine your human resource and risk management needs.
  2. Make sure the PEO is capable of meeting your goals. Meet the people who will be serving you.
  3. Ask for client and professional references.
  4. Ascertain that the PEO has a demonstrated history of adherence to the industry’s professional performance practices, including responsible financial management of its business. Check to determine whether the PEO’s financial statements are independently audited by a CPA, its risk management practices have been independently certified by the Certification Institute, or its operational, financial, and ethical practices have been independently accredited by ESAC.
  5. Check to see whether the company is a member of NAPEO.
  6. Investigate the PEO’s administrative and management expertise and competence. What competence does its internal staff have? Does the PEO’s corporate staffing allocation follow the priorities of its marketed services? Does senior staff have professional training or designations?
  7. Understand how the employee benefits are funded. Is the PEO fully insured or partially self-funded? Who is its third-party administrator (TPA) or carrier? Confirm that the TPA or carrier is authorized to do business in your state.
  8. Understand how the employee benefits are tailored, and make sure they fit the needs of your employees.
  9. Review the client service agreement (CSA) carefully. Confirm that each party’s responsibilities and liabilities are clearly laid out. What guarantees are provided? What provisions permit you or the PEO to cancel the terms of the contract?
  10. Make sure the PEO you are considering meets all applicable state requirements.


Emplicity understands that HR Outsourcing should be simple and meaningful. As a Professional Employer Organization (PEO), we strive to be a great partner in supporting your business. If you would like to request more information on how we can assist your needs, please reach out to us at 877-476-2339. We are located in California – Orange County, Los Angeles, and the greater Sacramento and San Francisco area.

NOTICE: Emplicity provides HR advice and recommendations. Information provided by Emplicity is not intended as a substitute for employment law counsel. At no time will Emplicity have the authority or right to make decisions on behalf of their clients.

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