Your company’s profitability depends on its people – and you want your team to be comprised of the brightest and the best. But it can be tough to compete against larger players, who can typically offer more attractive wage and benefit packages, by virtue of their size alone. What’s a small-business owner to do to attract and retain the best talent?
A competitive employee benefits plan is one of the 4 Pillars of Profitability that must be well managed in order to keep your doors open. (The others are payroll and payroll tax administration, safety and risk management, and HR compliance.) Benefits administration isn’t your area of expertise … nor should it be … nor does it have to be. The tasks and responsibilities associated with employee benefits can be effectively outsourced via a partnership with a professional employer organization, or PEO.
Pillar # 2: Employee Benefits
A PEO provides small businesses with a comprehensive menu of HR services. You establish a co-employment relationship with your PEO, whereby the PEO assumes responsibility and liability for the business of employment – including benefits administration – and your maintain operational and management duties.
- Between 2008 and 2017, the number of workers employed by a PEO grew at a compounded annual rate of 8.3 percent. This is roughly 14 times higher than the compounded annual growth rate of employment in the overall economy during the same period. And privately-held businesses that use PEOs are approximately 50 percent less likely to fail when compared to their non-PEO counterparts.
Let’s Talk Benefits
The right PEO can provide a full suite of benefit options for your employees, including:
- major medical plans with health (HSA) and flexible savings (FSA) options.
- 401(k) plans.
- health, dental, vision and life insurance.
- dependent care.
- retirement plans, and much more.
PEOs offer access to an assortment of voluntary benefits specially tailored to an employee’s individual needs. Often referred to as cafeteria plans, these programs are managed to take advantage of section 125 pretax deductions.
When it comes to open enrollment, experts from your PEO can manage any or all of it for you, including answering employee questions, explaining the options, and handling all related filing and updates. Access to the latest HR technology is another benefit of a PEO partnership.
How is this possible? The answer lies in a PEO’s economy of scale, as it pools employees from its client companies together. This makes it realistic to obtain lower rates and offer your team members multiple benefit plan designs – comparable to those they might find at a Fortune 500 firm.
A Team of Experts
Your PEO provides you with a team of subject matter experts who know your business and are in constant communication with one another. This empowers you to keep tabs on all 4 Pillars of Productivity and ensure that your business shines when it comes to keeping them strong.
To learn more about working with a PEO, give the Lyons HR team a shout today. We’re among select PEOs accredited by the Employer Services Assurance Corporation and certified by the Internal Revenue Service, ensuring our clients the highest levels of service and financial security. In business for more than 25 years, we serve hundreds of employers and thousands of employees across the U.S. We’re passionate, we care about growing your business, and We Are HR.