The myriad employment laws and regulations that apply to small businesses can be mind boggling. They’ve increased by more than 400 percent since 1980. The different acronyms that refer to them are often referred to as the “alphabet soup of HR.” Agencies of the government – even as it encourages entrepreneurship and innovation among small companies – continue to enforce all sorts of burdens, restrictions, obligations and responsibilities on any employer who has more than one employee. And as demonstrated over the past four decades, it stands to reason that the list will only get longer.
When you’re hit with an audit, getting that phone call or notice can be terrifying, unless you’re ready to hit the ground running.
Let’s talk risk management.
Along with payroll and employee benefits, two of the Four Pillars of Profitability that keep your company afloat are HR compliance and safety and risk management. All four work in concert to keep your business running smoothly and seamlessly every day. But to focus on your employment practices, if you partner with a professional employer organization, you give yourself an extra layer of insulation from liability through the PEO co-employer relationship.
- Some PEOs, including Lyons HR, extend their Employment Practices Liability Insurance (EPLI) coverage to their clients, saving them the cost of maintaining their own separate policies. This liability sharing is defined in your Client Service Agreement (CSA) – and liability mitigation is the most critical component of the value proposition.
Now let’s talk compliance.
HR compliance demands ongoing monitoring and consultative feedback regarding the most important yet variable asset of your company: your people. Auditors can – and will – put a wide variety of areas and issues under their microscope. To give just a few examples:
- Are your hiring practices fully legal?
- Is your compensation plan free from discrimination?
- Do you have all the bases covered when it comes to terminations?
- How do you decide when an employee deserves a raise or promotion?
The bottom line is: you can’t afford not to be compliant. The collateral damage can range from penalties and fines to damage to your brand or in the worst case, bankruptcy or business closure.
Nail every audit that comes your way.
Audits are no fun, but they’re part of running a successful business. Your PEO’s understanding of the increasing complexity and legal responsibility of being an employer, and its ability to keep your company compliant at all times, is among the most compelling reasons for you to partner with them.
- Outside of a PEO relationship, all your HR vendors – including insurance and workers’ compensation brokers, attorneys, CPAs, 401(k) administrators, providers of time and attendance systems, and more – are disconnected from each other. In many cases, they may not even know each other. Doesn’t it make more sense to achieve total, system-wide integration by consolidating them all on the same platform? At first blush, you may think the cost of doing so would be prohibitive. But in fact, a PEO relationship can usually be acquired at a fraction of what it would cost to hire a single HR employee, let alone a team of experts in various areas – and ensure that they consistently deliver on all four Pillars of Profitability.
Looking to Reduce The Work You Have To Do For Audits?
To learn more about the benefits of a PEO partnership, including compliance and audit support, contact Lyons HR today.