PEO - Professional Employer Organization
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Solve Your Health Care Headaches With A PEO - Professional Employer
Organization
By: Bonnie Jo Davis
There are many complications to being a small
business owner but none so pressing as the need for health,
dental and life
insurance. Many small business owners obtain coverage through
the employment of their spouse. However, there are just as many
small business owners who are not married, whose spouse is also
self employed or not offered benefits through their employer.
Another option for a small business owner
is to partner with a Professional Employer Organization (PEO). PEO’s,
also known as employee leasing companies, handle the human resources
functions of companies of any size but they focus primarily on small
and medium sized businesses. Some of the human resources functions
handled by a typical PEO are:
* Payroll
* Direct Deposit
* Worker’s Compensation Insurance
* Health Insurance
* Dental Insurance
* Life Insurance
* Retirement Plans
* Tax Deposits and Reporting
* Regulatory Compliance
A PEO groups together businesses of all sizes
in order to get the best rates for benefits and to reduce human
resources costs to a minimum. In order to work with a PEO you will
be asked to fill out an application and provide a set-up fee ranging
from $50.00 to $300.00 depending upon the size of your business.
Monthly fees will be determined by the PEO and are usually based
on the number of payroll checks issued during each month and the
number of employees. Your company will be billed, at least monthly,
for the cost of fees, benefits, taxes, etc. not paid by employees.
After signing a contract with a PEO your
employees will need to fill out employment and tax forms that will
then be forwarded to the PEO. The PEO then becomes the employer
of record for the employees and from then on handles all payroll
and benefit tasks. Timesheets, benefit enrollments and changes will
all be submitted to your PEO and you will receive regularly scheduled
management reports. At the end of a calendar year the PEO will provide
all employees with a W-2.
Some PEO’s work with companies in every
state and others are state specific. You can find individual PEO’s
by using a search engine such as Google. You can save time by using
the free services of a PEO clearinghouse such as www.StaffMarket.com.
You can also find a SEO by visiting The National Association of
Professional Employers Association (NAPEO) at http://www.napeo.org.
NAPEO offers a directory of members searchable by company name,
state or country and offers guidelines to help you screen and select
a PEO.
A PEO may not be the perfect solution for
every small business but it is an option for individuals and companies
who are willing to outsource human resource functions to obtain
much needed benefits, improve employee retention and save time that
can be better used to growing the business.
Bonnie Jo Davis is the President of virtual
assistant firm http://www.DavisVirtualAssistance
and the author of the new e-book “Articles That Sell.”
Visit
http://www.ArticlesThatSell.com for frugal small business marketing
tips.
© 2003, Davis Virtual Assistance.
All rights reserved.
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