Are PEOs Worth It?

First, if you want to know what a PEO is, here’s a link to another page on our website that should help explain: Learn What a PEO Is Here

OK, back to the topic: are PEOs worth it?

This is a common question and the answer is not a simple Yes or No.

Whether a PEO is worth it is whether you derive value from it.

Another way to say it is: a PEO that is worth it is one that you’re satisfied with!

Why might a business be satisfied with the services of a PEO?

Here are five reasons that come to mind:

1. You’re a small business owner and you’re wearing too many hats. In most small businesses, the owners typically handle all the human resources, payroll processing, legal compliance, insurance audits, taxes, accounting, and more. Each of these all tend to become more complex over time as new laws and regulations are passed. A PEO takes all these things off your to-do list and lets you wear far fewer hats.
2. You have less than 100 employees and you are paying small-group health rates, which are more expensive than large-group rates. A PEO will give you the less expensive large-group rates. How does this work? The PEO has a giant insurance plan for all its clients in place. When you sign up with the PEO, your employees get to join the large-group plan, regardless of how many employees you have.
3. You have a high workers comp rate and you need some relief. A PEO can often lower workers comp rates either by eliminating a high Experience Modification or Xmod, or by offering a lower rate on your governing class codes, or both. Similar to the way the group health works, the PEO has a master policy that each of the PEO members get to be a part of.
4. You are a contractor who needs accurate job costing to be competitive and more importantly, profitable. Inaccurate job costing can wipe out all the profit on your contract and mistakes are often made in the bidding process when inaccurate tax and workers comp rates are used. A PEO uses a composite rate easily visible to you that accurately provides the true cost of your labor.
5. You have employees in other states or other countries. Whether you are big or small, the rules and regulations of other states – and especially other countries – can be extremely complex, expensive, and time consuming and the cost of paying someone in house to manage this

This isn’t an expansive list, but these are the top five I’ve seen based on my experience with PEOs. Maybe I’ll add more to it when I think of a new one!

AND LASTLY, if you are wondering if a PEO might be right for you, or simply want to know more, please click on the “Schedule a Call” or “Send Email” button below.

Our process is simple:

1. Set an appointment. Just click on one of the buttons below!
2. Have a conversation. We’ll learn about you and your business, gathering all the information the PEO needs to offer a quote.
3. Present your plan. Once we’ve received your custom offer from the PEO, we’ll reach out to you and schedule a time to discuss and review your no-pressure potential PEO solution.