Questions To Ask when Choosing a PEO
A Professional Employer Organization (PEO) partnership can have huge benefits for your company, but it’s important to know you’re working with the right partner. Here are some important questions you should ask PEO experts as you search for the one that’s right for you.
How long have you been in business?
Longevity is a key indicator of how well a PEO handles its fiduciary responsibilities and delivers HR value to its clients. StaffScapes has been in business since 1996.
Do you specialize in specific industries?
Some PEOs specialize in specific industries such as restaurants or banking. While this can help them better serve clients in those industries, it can also lead to gaps in knowledge.
StaffScapes has chosen not to take this route and we accept each client based on the extent we can offer value.
Will I be assigned to one person or a rotating team of individuals?
Many large PEOs have high staff turnover within large departments that handle heavy client workloads. In these situations, a team is often assigned on a rotational basis.
StaffScapes is able to offer our clients a dedicated team to handle their account. Each employee has a cross-trained backup person who can assist you if your primary person is not available. This gives you valuable continuity.
Are your team members certified?
Certification is an indicator of commitment to the industry and to the PEO’s clients. In our opinion, certification demonstrates a dedication to a career and not just a paycheck.
At StaffScapes, our team members are certified through the Society of Human Resource Management. They also maintain licenses for insurance and benefits. We frequently send our team members to additional training seminars in order to keep their certifications current.
Do you charge a flat fee or a percentage of payroll?
PEOs typically charge a flat fee based on needs, risk, history, and current rates. However, for some businesses, it makes more sense to pay a percentage of their payroll, which may more closely approximate the amount of work the PEO is performing, and will grow at the same rate the company grows.
StaffScapes is flexible on this issue and offers both a flat fee or percentage option, whichever is best for both parties.
What additional fees do you charge other than for payroll?
Be sure to compare apples to apples when looking at pricing. Some PEOs charge additional amounts for employee W-2s, new hires, terminations, employee handbooks, and other services and products.
StaffScapes includes many of these as standard services.
What is your commitment to future technology?
As technology continues to advance, you’ll benefit from having a PEO partner who progresses with it. If you and your employees are able to conduct transactions from a variety of platforms and devices with the latest data security, that saves you time and avoids risk. However, you also need to be certain your PEO partner is committed to proper testing and only uses robust apps and software.
Data security is a primary concern at StaffScapes. We are committed to staying current with the latest and best technology, but we will only introduce new methods once we are confident that all necessary protections are in place.
How do you handle problems with paychecks?
In addition to asking how problems are handled, be sure to ask the PEO experts about error percentages, specifically those that are material to the satisfaction of their clients. If they cannot readily produce concrete numbers, the PEO might not be as concerned with excellent customer service as they should be.
StaffScapes tracks all client issues and periodically reviews the data as a team to ensure that the processes in place are working well and each client is receiving error-free payrolls and up-to-date advice. We are proud to say that our error rates are less than one percent. Any errors that do occur with paychecks are immediately investigated and rectified.
When was the last time you were audited?
Third-party oversight is critically important in the PEO industry. These independent audits ensure that a client’s money is being handled responsibly and required tax payments are being made as promised.
StaffScapes is audited annually by a third-party firm and complies with the findings of these audits.
What forms of protection do you offer, such as liability, monetary etc.?
Ensuring that the PEO is protected in the event of unplanned events is another key indicator of its ability to survive in the long term. You should ask for coverage confirmation and consider speaking with advisors.
StaffScapes maintains policies for general liability, Employment Practices Liability and workers’ compensation.
Describe your benefit offerings.
One major advantage of working with a PEO is that you can often offer far better benefits than you could on your own, leading to better employee relations and retention. Be sure your PEO partner can offer full, affordable benefit options before you choose to work with that company.
StaffScapes offers dental, vision, life, AD&D, accident, critical illness, disability, EAP, 401k, and access to several health plans as part of our benefit program.
How long have you been working with your current benefits providers?
The relationship between a PEO and its third-party partners, including information about the turnover they have had with these providers, can be an indication of the soundness of the PEO’s business operations. If these relationships change frequently, this could signal issues with service, finances, or employee satisfaction.
StaffScapes has worked with the same benefit providers for more than 15 years.
May I speak to a few clients and employees regarding their experiences with your PEO?
Talking with current and even former clients and/or employees will give you a helpful perspective on how a PEO will handle your account and take care of your HR needs.
StaffScapes will be happy to put you in touch with several individuals to discuss their experience with our services.
What organizations are you members of?
A PEO in good standing with industry organizations generally has better access to information and updates that could impact your business, and can serve you better as a result.
StaffScapes is a member of The National Association for Professional Employer Organizations and The Society for Human Resource Management. Additionally, we find that active participation in these industry groups enables us to be a proactive force for positive change within the PEO industry.
What service structures are available to me? Is co-employment my only and/or best option?
Co-employment is when both your company and the PEO carry out the employment functions for your workforce. Depending on your situation, this may or may not be the best approach for you and your employees. Many PEO experts, including StaffScapes, offer various levels of service options to fit your needs. Request that the provider describe the scope of services they offer and ask if they will help assess what combination of HR services would work best for you.
In general, most StaffScapes clients work well with the PEO co-employment model. However, an Administrative Services Organization (ASO) option, which is similar to the PEO model but does not include co-employment, is also available.
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