Top ten excellent benefits of PEO services
PEO or Professional Employer Organizations are enterprises that provide business process outsourcing (BPO) services relating to human resource (HR) development and management. With globalization, human resource management has increasingly grown complex and consumes a great number of resources for an enterprise. It has thus grown sensible that a business should outsource them. Partnering with the best PEO services can provide valuable benefits to an enterprise that shall be discussed here in detail. One example of a peo company is INS Global Consulting, which may help you deliver your tasks
The following are some of the most valuable benefits of taking PEO services:
- Payroll management
Payroll management is one of the core functions of human resource management for any enterprise. It turns into a bulk and time-consuming activity for enterprises with larger workforces. The process is complex as different types of employees may enjoy different compensations, and there are several other factors and calculations involved, including withholding taxes, Tax Deducted at Source (TDS), tax returns, adjustments for advances, bonuses, etc.
Further, there is also the physical process of generating paychecks or timely crediting of bank balances. Needless to say, the resources devoted to these tasks may be better deployed by an enterprise focusing on its core operations, and it is possible to do so with the help of PEO services.
- Smarter perks and benefits
Our understanding of human psychology has improved a great deal in the past few decades, and a piece of specialized knowledge and research by PEOs enables them to create holistic benefit packages and perks that shall help maximize the motivation of the employees. Some of the best packages shall also include benefits like health insurance, retirement plans, etc.
- Lowers litigation costs
Lawsuits by employees and ex-employees can consume a significant amount of a company’s revenue. Lawsuits may arise if a company fails to comply with local fair compensation, security of workspace or anti-discrimination laws, or any other national or federal laws. These lawsuits have grown only harder to avoid as businesses grow global, have workforces in multiple countries, and must comply with employment-related laws and regulations of all such countries. However, partnering with PEO can help an enterprise ensure that the enterprise will comply with local as well as international laws and regulations. That, in turn, can help lower the litigation costs.
- Getting new employees made easy
PEOs can assist their clients in recruiting new employees for various levels and posts. From recruitment, an enterprise may also assist with the onboarding and training of new employees. Further, since these enterprises have this as a core activity, they are able to more efficiently find the desired quality of recruits. Thus, the whole process is faster and streamlined. That can help reduce recruitment costs for the enterprise tremendously.
- Reduces the size of HRD operations
HRD departments are responsible for handling staff, but often they come to hold sizable staff themselves due to the plethora of tasks they must handle. PEO services offer an excellent alternative to the problem by letting the business outsource most of these activities. That can help reduce and rationalize the size of the HRD department and its operations, thus bringing the cost of human resource management and letting the business focus on its core operations.
- Lowers workforce turnover rates
PEO provides better and smarter management of workforces and their compensation. That, in turn, means more motivated and more efficient employees. Thus, employees stay motivated and stay with the enterprise longer, thus reducing the workforce turnover rates. Workforce turnover rates or staff turnover rates are the rates at which the workers leave and get replaced by the company. As every new worker must be trained and oriented afresh and might make costly mistakes, having a lower workforce rate is considered highly desirable.
- Lowers training costs
PEOs can also help in significantly reduce training and orientation costs significantly. They may achieve this in several ways, such as by providing better and more skilled recruits, reducing the workforce turnover rates, helping create better and more cost-effective training and orientation programs, etc.PEOs can also tremendously reduce the risks associated with human resource management, such as workspace accidents, strikes, etc.
- Lets an enterprise focus on one’s core activities
It is a principle of modern business practices that an enterprise should outsource all the tasks and activities that are related to central or core functions. Thus, enterprises outsource everything these days, from financial tasks to IT management to human resource management. A better focus helps enterprises gain more efficiency and profitability.
Even though PEOs charge a fee for their services, they prove to be a more cost-effective solution than handling human resource management. That is because it helps lower the costs significantly – like training costs, human resource costs, payroll management costs, etc. Further, it helps create a more motivated workforce that serves the enterprise more efficiently and longer, thus increasing efficiency. Further, since management is focused on core activities, that helps too.
- Increases the profits of one’s enterprise
In the commercial world, everything boils down to the profits in the end, and that is true for the choice of human resource management solution one chooses. As mentioned above, taking the services of a PEO is a cost-effective solution as it saves more than it costs. Not only that, it has resulted in improved profits for the enterprise. Thus, any money one pays on taking the services of a PEO can be thought of as a small investment and not an expense that will pay a rather handsome return in the form of increased profits. Increased profits, of course, in turn, mean a better return on investment for shareholders or owners of the enterprise.
The bottom line
One can wrap up the above discussion by concluding that taking the PEO services is the best solution for almost all enterprises. However, a note of caution must be added here to the effect that no two PEO companies are the same, and one must only go for the best PEO companies after doing a thorough research and checking the ratings, reviews, experience, and goodwill of various agencies.