PEO Alternative

Sometimes companies have trouble meeting their human resources needs, especially while also trying to increase profits. To assist in this area, many companies hire professional employer organizations (PEOs) to delegate many of its HR responsibilities. The PEO handles payroll, benefits administration, workers’ compensation, medical insurance and retirement accounts. Then, the company pays the PEO for its services.

PEO-Alternative Services

A typical PEO provides the following six main services to its clients:

1 HR Guidance

A good HR policy provides generalized guidance on the approach adopted by the organization, and therefore its employees, concerning various aspects of employment.

2 Compliance

A process of defining policies and procedures to ensure your employment and work practices demonstrate a thorough understanding of applicable laws and regulations, while also being aware of the company's larger human capital resources objectives.

3 Service

Responsible for providing accurate and timely front-line support, while going above and beyond in assisting our clients.

4 Legal Affairs

A practical guide on HR law and regulations: what you should know & how to ensure compliance to avoid breaching human resources laws.

5 Technology

Automating the human resources function in organizations. It includes employee payroll and compensation, talent acquisition and management, workforce analytics, performance management, and benefits administration.

6 Benefits

Benefits selection and design are critical components in the total compensation costs. In some cases, benefits account for 40 percent or more of total compensation costs. Due to the employer cost investment and the importance of employee benefits in recruiting and retaining, employers should have a well-thought-out benefits plan design that meets both employee needs and employer objectives.

Advantages of working with a PEO

  • Employers do not need to spend time and resources on HR tasks. Instead, they can focus on their core business and growing their bottom line.
  • PEOs can provide consistent administration for larger companies, and often improved technology resources.
  • Employers do not have to handle as many legal intricacies regarding HR tasks.
  • Employers do not have to hire as many HR professionals in-house.

Traditional PEO vs PEO Alternative

Traditional PEO vs PEO Alternative
Traditional Alternative
HR Guidance
Legal Affairs
ACA Supoort
Employee notifications
FMLA Tracking
Ben Admin
Technology Integration
Flexible compensation packages
Control over benefit plans offered
Assumes role as legal employer
Charges admin service fee - typically per employee per month
Negotiating power with benefit carriers
Assumes liability of legal tax and workplace standards

Making Your Decision

Ultimately, if you want to work with a PEO, a PEO Alternative is an option that must be considered in light of your company’s cash flow, risk tolerance, employee numbers and preferred budgeting methods.

Contact ThinkTank Insurance Partners for more information about coverage options.