Why Outsourcing Doesn't Have to Mean a Loss in Control

PRemployer on March 29, 2019

Why Outsourcing Doesn't Have to Mean a Loss in Control

As a business owner, losing control is one of the top concerns expressed by potential PEO clients. But while the PEO company assumes many responsibilities, the client still maintains full control and direction of the business.

As your HR partner, the PEO can step in and help share the responsibilities of running your business while allowing you to retain control where it really matters - saving you time and money and boosting productivity and efficiency. Below are a few reasons why outsourcing doesn’t have to mean a loss in control:

Co-partner Relationship

When outsourcing to an HR company, especially with a PEO like PRemployer, both entities enter into a partner-based relationship. The roles of the PEO and the client company depend upon the nature of the relationship, and each party is responsible for certain obligations of employment. According to the National Association of Professional Employer Organizations , the leading voice of the PEO industry, while both parties may share responsibility for other obligations and be “an” employer, neither party is “the” employer for all purposes.

With this co-employment model, both the PEO and the client company establish a relationship with worksite employees. The PEO may engage with employees in matters involving human resource management and compliance with employment requirements, while the client company continues to direct and control worksite employees in day-to-day operations as well as the production and delivery of products and services. The employer will also provide employees with the tools, instruments, and work environment needed to do their jobs effectively.

PEO and Client Responsibilities

When partnering with a PEO, there are responsibilities the organization may have and the employer may maintain. In some cases, both parties will even share some responsibilities. Most PEOs assume responsibility of all non-revenue generating tasks, including payroll management, payroll taxes, benefits and compliance with employment laws and regulations. Some examples include remitting wages and withholdings of the workers, issuing W-2 forms for compensation, and all duties associated with employment taxes with local, state and federal authorities.

As the client company, you are still responsible for running the actual day-to-day business operations including hiring, performance management, discipline and determining pay rates.

A PEO can provide a multitude of services, while employers receive the following benefits:

  • Relief from the burden of employee administration

  • Dependable partner to handle HR, risk management and payroll

  • Ability to focus on the business and its growth

  • Effective employment practices

  • Increased levels of regulatory compliance

  • Risk management strategies that improve workplace safety while reducing workers’ compensation costs

  • Compliance with all laws and regulations

  • Trusted solutions to increase productivity and profitability

  • Seasoned team of experts and seasoned professionals with management expertise to help enhance and improve business performance.

As the client company, you will have expert guidance on regulatory compliance, time-keeping systems, access to resources and materials, improved cost control, unemployment claim management, payroll professionals and unprecedented service to ensure your organization runs smoothly.

Partnering with a PEO to handle your human resource functions doesn’t have to mean a loss in control. Rather, it’s the start of a beneficial partnership that allows you to focus more of your time on the success of your business. Learn more about PRemployer and how we can help improve your business performance and profitability.

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