California Business Owners – Which is the best PEO?
Increasingly, small and medium-sized businesses are discovering that partnering with a professional employer organization (PEO) can streamline daily operations and significantly reduce employee-related costs. California
based employers are discovering the added peace of mind that comes from choosing a CA-based PEO.
Professional employer organizations are sometimes referred to as employee leasing companies because a PEO is different than an outsourced HR department. They handle everything related to payroll and employee benefits, as well as workers compensation and other risk management, government compliance and tax liability matters.
There are many specific benefits to a PEO partnership.
Small and medium-sized businesses are discovering that they can save time and money by investing in a PEO:
- PEOs employ experienced professionals who are knowledgeable, efficient and accurate; their job is to follow and understand employment laws and regulations.
- Small businesses can obtain a higher level of expertise and solutions that might otherwise be unaffordable.
- The small business does not have to research, buy, learn and maintain the latest technology relating to HR and
compliance; the PEO manages the HR technologies. - Services are scaled to match the individual needs of the company, so costs are predictable and budgets can be managed more effectively.
- Small business owners never have to worry about falling behind on tax reporting or payments if they outsource tax responsibilities to their PEO.
- The employees are part of a larger group, so that healthcare insurance and workers compensation premiums are significantly reduced. The associated hassles of paperwork are also eliminated as this work is outsourced to the PEO firms.
- Employee-related operations remain well-integrated within the rest of the business operations.
In short, the small business owner can enjoy a valuable competitive advantage by focusing on his or her core competencies – product and business development. Working with a professional employer organization can help the business prosper and be more profitable.
If your business is located in California, choosing a CA PEO makes the most sense.
Virtually every aspect of a PEO’s services revolves around rules and regulations. The work is detailed, complex and very often time-sensitive. Any professional employer organization can take this burden off the shoulders of the companies with which it “leases” employees. However, for small businesses located in California, you may want to consider a PEO company that focuses solely or predominantly in the Golden State, as they might be more apt to understand the culture in which the small business negotiates business. Obviously some regulations and reporting requirements are uniform regardless of state. But those are primarily federal issues. There are also state-specific regulations that a company based in the state would best understand, meaning a state specific PEO may be your best option.
A California PEO makes the most sense for a California-based business, but each PEO is a little different and each company is a little different. Ultimately, the small business owner of the California company needs to determine which PEO company will be the best partner for his or her business, whether that is a PEO with a physical location in California or one that is merely incorporated in California.
