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Size does Matter:

Businesses that benefit most from using a PEO have anywhere from 10-100 employees. There are a couple of reasons why. <!–More–>

· When a business has less than 100 employees, selecting a full-time, qualified HR professional can be too costly to justify. Most PEO’s hire HR professionals that are certified by the society for Human Resource management, and many with a Master’s Degree. The price: $60-$110k each year.

· When a business has over 100 employees, they start entering the range where savings of sale(savings achieved by producing or purchasing large quantities of a product )work in their favor when buying health and worker’s comp insurance.

· When a business has less than 10 employees, they’ll struggle finding a PEO that will accept them in their healthcare plan.

· If a business has less than 10 workers, and they DO get accepted to a PEO’s medical plan, the cost savings provided through medical insurance does not have a profound impact on offsetting the PEO’s fees.

· When a business has less than 10 employees, Human Resources isn’t a big burden to manage.

White Collar Companies:

White collar industries such as IT, professional services, and fiscal services generally must attract highly skilled workers, to do so they have to compete with huge companies that offer structured career paths, and good benefit packages.

Professional Employer Organizations provide a excellent solution for this challenge; they will offer a benefit package comparable to that of a Fortune-500 company, and they provide HR service which enables a small business to organize its workers’ career paths in precisely the identical manner. For more information, contact PEO Canada.

In addition, we find that with high-growth businesses, they are just moving too quickly to sidetrack themselves with the administrative burden of handling HR issues in a way that keeps them in compliance, and also enables them to attract top talent.

Blue Collar Firms:

In low-skill orientated blue collar businesses, attracting top talent isn’t the identical priority it’s in white collar businesses. However, semi to high-skill blue collar businesses have to compete for talent with marriages, particularly if part of the workforce is already unionized. Because of this again, PEO benefit packages offer a excellent solution.

Workers Compensation Insurance is typically a high cost item in blue collar industries who have riskier jobs, more significant is how expensive an accident at work will be for the provider’s workers comp experience rating, which determines future premium amounts. Through co employment a PEO provides insulation against future premium increases should an accident occur. What’s more, the PEO provides risk management solutions to protect the business from using a worker’s comp claim in the first location. When an accident does occur they’ll fight all workers comp claims in court to prevent fraudulent claims, which are more prevalent in high risk jobs.

Seasonal Firms:

Seasonal businesses with substantial fluctuations in the workforce benefit greatly from Professional Employer Organizations. This is largely because of the stability PEOs provide so far as state unemployment taxes. Learn more about Payroll Administration | PEO Canada.

PEOs make sessions with voluminous new hires or terminations very straightforward. They provide new hire support; such as services such as job posting discounts, employee registration kits, background checks, drug screens, etc.. For terminations, the most important facet is that PEOs will help companies do it in a fashion that’s in compliance with all regulations.

Multi-State Firms:

Small companies which operate with employees in several states or of the ones that can benefits the most from using a Professional Employer Organization. PEO’s permit a company to hire workers in a variety of states without further administrative burden. Here are a few reasons added reasons :

· Each state has their own set of employment legislation to comply with

· You have to file for a state unemployment ID in each state

· You must find worker’s comp insurance in each state

· Preparing a benefit package, complete with supplemental benefits, across country boundaries created tremendous administrative burden

A multi-state structure may limit the quantity of PEOs you should think about in the purchasing process; as many regionally based PEOs aren’t aggressive with multi-state benefit programs, also they might not be accustomed to different state regulations.


Limited Liability Corporation is a popular construction in law firms, medical clinics, or other businesses with numerous owners/partners. This structure yields various advantages; nevertheless one of the downsides is that LLC partners can not be W-2 employees of the LLC.

If partners aren’t employees, they are not eligible for unemployment benefits, nor will they participate in business medical insurance plans. Often LLC partners buy health insurance separately, which is normally more expensive.

Professional Employer Organizations provide a special solution. Through co employment, an LLC member may be W-2 worker of the PEO with no employee of the LLC. Often partners take a minimum salary from the PEO, enough so that they qualify to participate in company benefits, but the smaller the better in order to maintain tax burdens low.

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